Days before he set out for his second India visit, the socialist president of France Francois Hollande admitted that his country was in a state of economic emergency. The unemployment rate in France is 10.6%. Read this against the International Labour Organisation (ILO) finding that the unemployment level in developed countries has fallen slightly from 7.1% in 2014 to 6.7% in 2015. That gives you a clearer picture.
India is likely to remain the fastest growing large economy for a long time to come. Though the right-wing Indian prime minister Narendra Modi doesn’t share many of Hollande’s socialist moorings, India-French alliance now is more about Paris getting deals from India than anything else. And that is the way it has always been. Needs speed up diplomatic engagement.
India has a declared military modernisation programme with a tab of 150 billion USD. French president, among others, need to look for ways to create jobs for some 3.6 million people back home. He has a presidential elections coming up in 2017. In shorts he is up against some real immediate tasks.
Rafale fighter aircraft deal, if its comes through at an early date, will be very good news for France. Each of this 36 planes India has decided to buy has a price tag of 160 to 180 million USD with their payloads and required armaments. Though purchase of air-crafts in flyaway cannot boost make in India flagship, French remains a technology superpower India badly needs as company. Many Indians firms HAL and private sector like L & T and Bharat Forge and others have long-standing partnership with France that India needs to leverage.
Ideologies can wait in international relations. India can drive its demands hard now. France has remained one of the most reliable partner for India in strategic terms. But now France needs a country like India in two of the crucial areas of this cooperation more than ever on account of economic factors. After defence comes the civil nuclear cooperation.
Areva, the French company to set up nuclear plants in Jaitapur in India is dogged by financial troubles for some time now. The French firm EDF took over Areva’s reactor business recently. As it is, Areva was not convinced about Indian government’s assurance on the nuclear liability regime. Now question marks have also been raised about EPR (European Pressurised Reactor) that EDR in building in Flamanville in Northern France. Areva plans to build six EPR reactors in Jaitapur.
Some key issues remain to be sorted out between the French nuclear regulator ASN and the EDR about the ‘weak spots in the vessel. ‘ of the reactors. (vessel the container that protect the reactor core). There have been strong protest against the nuclear plant in Jaitapur on many counts. But the troubles the Areva is snowed under now will push the deal further back. By many accounts EDR needs huge loads of money to revive Areva. The nuclear majors across the world are struggling to stay in profitable shape.
The views expressed are personal.