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A strategic destination

India and the EU have no conflicting interests, only common goals. Tharoor explains that the strategic task of India's foreign policy is to support domestic growth and alleviate poverty in India. I agree. Michael Steiner writes.

india Updated: Oct 18, 2012 22:44 IST

In his article A holiday destination (October 17), Shashi Tharoor writes: "In the immediate priority areas of strategic interest to India the EU is almost irrelevant". He adds: Europe is ideal for a summer holiday, but not for serious business. I disagree with his views.

Tharoor explains that the strategic task of India's foreign policy is to support domestic growth and alleviate poverty in India. I agree. But if this is true, how is Europe strategically irrelevant for India?

Consider these facts: The European Union (EU) is the world's largest economy, in real terms as well as in purchasing power parity. While it is true that we are facing a debt crisis, the combined eurozone sovereign debt of 88% GDP is still below the debt of other developed economies such as the US (103%) or Japan (130%). The eurozone's account balance is positive, unlike the US's. Its per capita growth rate is higher and inflation is lower than America's. A vast majority of Europeans enjoy health insurance and a social security net that gives them strength. As far as competitiveness is concerned, six out of 10 world's most-competitive countries are European.

Once the origin of two world wars, Europe is now unified and that is why it received the 2012 Nobel Peace Prize. Indian Prime Minister Manmohan Singh once talked about his vision for South Asia: breakfast in Amritsar, lunch in Lahore and dinner in Kabul. In Europe, this has become a reality: you can breakfast in Warsaw, lunch in Berlin and have dinner in Paris.

Yes, this crisis is serious. But what has been achieved in eurozone was unthinkable only two years ago, when the crisis started. At the same time, Europe has opted for growth, not through more spending but through better spending and major structural reforms. This policy is working but requires political courage. I am convinced that once we have mastered the current challenges, Europe will come out stronger.

A strong Europe is also in India's interest because India needs strong partners who think alike. Going it alone is not an option any more in a globalised world. The best partnership, I see for India, is the one with Germany and Europe as there are no conflicting, only common strategic interests.

India needs long-term investment, trade, vocational training, and more. India's biggest trading partner, Europe, has all this on offer. Right now, a Free Trade and Investment Agreement between the EU and India is being negotiated. Its conclusion would be the necessary outer equivalent to the inner reforms that the Indian government is currently pursuing. It would boost the economy.

Europe and India are both global players in the making. With regard to economy, Europe is already a global player. In other areas, such as common foreign policy, we are surely not there yet. But we are on our way. The same holds true for India: in some areas India still has a way to go. But I am sure that India will arrive there, I know that Europe also will.

It is for these strategic reasons, Europe is as relevant for India as India is for Europe. In fact, they are ideal partners - both for summer holidays and for serious business.

Michael Steiner is Germany's Ambassador to India

The views expressed by the author are personal

First Published: Oct 18, 2012 22:40 IST