Introductory Remarks: General Banerjee

Good Evening,

On behalf of the Institute of Peace and Conflict Studies and the Konrad Adenaeur Foundation, I extend a very warm welcome to you. We meet to commemorate an important occasion. On 8th November this year, at The Hague was held the 5th EU-India Summit in which was reached an important partnership agreement. This indeed has been historic, at least for three reasons. First, the agreement promises to usher in an era of dramatic new relations between an emerging India with its growing economy and a greater role in international affairs and a European Union which has grown now from fifteen to twenty five countries with a population of 450 million. As a result of that process, its economy too is burgeoning.

Second, in the global environment of today, somewhat troublesome and with major challenges ahead, a partnership between India and the European Union with their strong democratic traditions, they have the potential to be a major force for peace and stability in the world. And finally, I think from India, as it looks around outside its own environment and in the process finds its own legitimate role in the world, this allows it a major outlet to shape its policies and opens up enormous potential for cooperation and progress.

This conference attempts to address some of these possibilities which this partnership agreement allows; what it signifies and what are its possibilities. We couldn't have asked for a better participation than the speakers today.

I have great pleasure in inviting Ambassador Eric Gonsalves to chair today's proceedings. He was the Indian Ambassador to the European Union some twenty two years ago; a very distinguished member of the Foreign Service and of course, he is also the President of the Institute of Peace and Conflict Studies. Over to Ambassador Eric Gonsalves.

Chair: Ambassador Eric Gonsalves

Since time is really of the essence, I think let us have a report on the summit and I give you ambassador ...Gomes, who is an old colleague of mine from my Brussels days before he of course went up to the top floor...into the company of the Commissioners and so we lost touch with him. Your Excellency Ambassador Gomes.

Ambassador Gomes

Thank you. Excellencies, ladies and gentlemen, thank you very much for inviting me to this occasion. It is really a pleasure being among you. Its not easy to make a report on what happened in Brussels because first of all, we have issued quite a comprehensive press statement that covers all issues and it will be redundant to repeat what is there. But I am on a very favourable position because after me I can be corrected or amended by Mrs. Sujatha Singh and therefore you will have a chance of getting a good report on that matter. I think it was a very successful summit. People who attended all five summits so far said it was the best of the five. I attended only two and obviously for me this second one was the best of the two. We have a very, very substantive agenda on the table and we agreed on something of importance for the future, to give significance to a strategic partnership. The discussions were very spontaneous, lively, with lots of substance and therefore, I think we achieved quite a substantial result. In the old days when Ambassador Gonsalves arrived in Brussels, the European Union was composed of twelve member countries. Nowadays we are 25 and it is still growing. So is our relationship with them are still growing.

We reckon that India is a major political actor in the world stage and sometimes we wonder if India recognizes European Union also as a major partner. So it was important for us to be seated around the table and just to make sure that both partners take due account of the views of the other. But, the fact that we are two major partners in the international arena doesn't mean that the level of our relationship is big enough, particularly in terms of trade and investment. We do believe that there is tremendous scope for increasing the flow of trade and investment on both directions and this is one of the major topics for discussions in the coming months when we will go forward to designing and establishing the action plan to implement this partnership.

The energy and environments were very much in the minds of everybody during the discussions at the summit. I think those two areas received special attention. Energy for obvious reasons because we are now in the middle of another energy crisis and Europe as well as India and China are probably suffering more than others as a result of the impact of the oil prices. Therefore, there is really a need for India and the European Union to have a meaningful dialogue on energy policies. Obviously, environment is also a matter of concern, specially climate change and other issues of global importance. India will host an EU-India environmental forum and we hope that the participation and the contents of the discussions will be very fruitful in the coming months. Of course there were also matters that had already been discussed in the previous summits and we agreed on the importance of India's participation in the Galileo program. This has not yet been signed because a few details are still to be settled between the parties, but the political will of both parties to work together within the framework of the Galileo program was again reaffirmed with force and this is quite important for the future of our technological and scientific relationship.

An important innovation of this summit was the declaration on the cultural dimension of our relationship. There is a joint declaration on cultural relations and cooperation. I hope that you can give substance to that in the coming months and organize a number of initiatives around that common willingness to cooperate on that area. Then we discussed lots of important topics for both sides - on the Middle East, Iraq, Iran, South Asia and so on, and we have almost on every issue come to the conclusion that we share a common vision of what is to be done to solve those problems. We might differ sometimes on how to address problems like human rights in Burma.

I don't believe that we have solved all issues in our cooperation. On the contrary this partnership is a starting point. We have now to implement this partnership with concrete measures. We have, as I said before, to design together an action plan and get that action plan approved by the summit next year. So, to sum up my impressions, this has been an extremely important and successful summit and we are very happy on the European side - on what we have obtained with that summit. Thank you very much for your attention.

Sujatha Singh

Thank you Mr. Gonsalves. Gentlemen, ladies, I can only endorse what Ambassador Camara Gomes has already said. We completely share his assessment that it was an extremely important and a successful summit. This is the fifth summit as you all know. It was held under the Dutch presidency. It was earlier scheduled for 14 October. It couldn't be held on that day because the Dutch Prime Minister was ill and at a very short notice we had it rescheduled to 8th November. The very fact that we could agree on dates so quickly and that special efforts were made by both sides to reschedule it at such short notice, is itself an indication of the importance that we attach to this very important relationship. The aspects that are of special interest have already been outlined by the Ambassador. I will give you a perspective from the Ministry of External Affairs in India.

First of all, this is the first summit that India has had with the enlarged EU. The enlargement took place in June, which for us is important. Second, it is the first summit we have had after the present government assumed office and most important this summit saw the launch of the EU-India strategic partnership. EU-India strategic partnership straddles the entire range of areas on which the EU and India have interactions. In one sense I must differ from what General Banerjee has said. India does not need dramatic developments to emerge on the world stage ten years from now. We think we are very much there, as is the EU. And there has really been no dramatic transformation. We were one of the first countries to have diplomatic relations with the European Community. And from a relationship that has been essentially trade and economic oriented, it has steadily grown over the past few decades into a relationship that covers almost every area that you can think of. This is natural given the fact that we share common values. There are certain common visions, common perceptions that have underpinned the relationship and have propelled them further into areas that go beyond economic and trade issues.

What is this strategic partnership? I think the European Commission did an excellent job in working over a year on a very comprehensive document that goes sector by sector on all the exchanges that there are between the EU and India and has proposed various measures, first to streamline all the existing relationship so that we can get them all into a tighter institutional architecture. It has also suggested new initiatives in new areas and where dialogues were episodic or were ongoing, has suggested having them on a regular basis. And there are new initiatives that it has suggested. India had its own response to the EU strategic partnership document which we did in two months. It was our preliminary recommendation but still fairly comprehensive and we came up with several new proposals of our own and these were discussed at the summit as the Ambassador has indicated. We indicated our areas of focus; energy and environment were certainly two of these areas, which both sides felt should have more intensive dialogue.

Yes, we had accepted he Community's invitation to host a EU-India environment forum and we hope this will lead to transfer of technology in the environment areas and this will help us to make a substantive intensification of our relationship in this particular field. We already have a joint working group on environment, we hope to draw in new stakeholders and promote an exchange of ideas. Side by side and this is important, we hope to have an energy panel which will look into all the various areas of generating energy from civilian nuclear energy, to renewable energy, to fossil fuels. These are important because they are also on the cutting edge of technology, they are the hi-tech areas as is our proposed participation in the Galileo project for which negotiations are ongoing. The strategic partnership document is already on the internet, it can easily be accessed. We would be now drawing up the joint action plan on the basis of the document and our response and the areas in which we wish to focus.

We have a year now before the next summit which will be held under the UK presidency towards the end of next year and we hope to have very focused interactions. Our own responses have gone into very specific areas. It's more than just words, its more than just talk. We have covered almost all areas. If I were to segment it very quickly, in the political field, for example, we intend to have regular prior consultations before major multilateral conferences and for cooperation on UN matters, dialogue at senior officials level in conflict management, post conflict reconstruction, we're going to strengthen our dialogue on disarmament and non-proliferation and especially threat posed by weapons of mass destruction and their nexus with terrorism. We hope to have an agreement with Europol and strengthen joint efforts in fighting terrorism.

On the economic area, I have already mentioned two areas. From our side we have made very clear and specific proposals. For example, the consequences of the enlarged EU and how they would affect our business. We also want to have a structured dialogue on business process outsourcing, so that we can have a joint assessment of the specific areas which can be of mutual benefit to European companies and to Indian companies. We haven't had a very adverse reaction on this from most EU countries, but there are fears that it might arise in the future and we think an informed dialogue would be better.

Similarly we'll be having more intensified dialogue on information technology, bio-technology, phyto-sanitary issues, nano-technology, textiles, setting up a working group to find out how the phasing out of the MFE will affect us. Apart from that we're looking at more intensive exchanges between our parliaments. A delegation of European parliament members were here just before the summit and they had very useful interaction with our parliament members. And I think that our common belief in democracy is a very strong underpinning factor and we intend to promote that as well as interactions between civil society, academic fields and scholars.

Finally, I would like to address the Ambassador's question, does India consider the EU an important actor on the world stage? Yes, indeed it does. That's a very unequivocal and unambiguous answer. On the economic front, the EU is India's largest trading partner. This is something we need to work on to make sure that the trade volumes increase and I think that we have to recognise in the words of what our Prime Minister said, that our shared values of democracy and human rights, pluralism and liberty, an independent judiciary and media, make us natural partners. This is what our Prime Minister said and I would like to repeat it. "India and the EU are independent and indispensable pillars of the world edifice resting on multiple pillars, capable of taking on the challenges of managing global interdependence". I will rest at that.

Chair

Thank you for these very brief but very well informed statements. I will give you a few minutes to comment and to discuss, but very brief comments please, or very brief questions.

Discussion

• An item of information that I wish to have from our panel, what is the quantum of FDI which has come to India from Europe and what is the quantum of investment which is being made by India in the EU. Just interested in the figures.

• Just a very brief question. What is happening at the social clause. I believe civil society is introducing very rigorous methods of checking on the manner in which labour policies are being implemented, particularly the core ones and the considerable amount of emphasis that is now being made on this. Is this going to become EU policy or will it remain with the civil society and with the consumer groups?

Answers

Ambassador Gomes

Not that I have a very clear answer to all these very valid points that you have made. First of all, access to new sources of energy and technology, this is very much among the priorities that have been identified during this summit and will be an integral part of the action plan that will be designed. That has a lot to do with the civilian use of nuclear technology for civilian purposes and it has a lot to do with access to new forms of energy, etc.

We, as much as India have a deficit in our needs for energy to maintain our growth. In the present crisis of energy, our growth is hampered and if the prices of oil go the way they are going, then that will be the case also of India and China. So we share a concern there and there is a scope for joint actions to access new forms of energy and technology. The dialogue on those technologies is one of the matters that we will be engaged in the future. On regional integration and regional cooperation, we ourselves are in a process of regional integration. By definition, we support all attempts made by regions like South Asia to build a regionally integrated system, whether it be SAARC or BIMSTEC. We support this kind of initiatives and we are ready if you want to share with us your own experiences and look at what has been our historic experience on economic integration.

On the global figures, I don't have the figures now with me on trade and investment, but we can provide that later. I know this has been increasing substantially over the last years. I know that if you take the European Union as an entity, we are the first providers of foreign direct investment in India if you add up all the EU member countries together. The same happens with trade. Labour policies and civil society pressures, I can't tell. But so far, our policy is within the framework of the WTO negotiations. Now, I am conscious that there are obviously lobbies at work inside the European society and within the European Parliament to impose stringent rules on labour or environment criteria and so on. Its not the official policy of the EU and if it will one day become or not, this is a question that have to be presented. You have to see how successful these lobbies will be one day. But for the time being, our rule is what is on the WTO treaties and nothing more. Thank you.

Sujatha Singh

I think the ambassador has already answered the questions on new sources of energy and technology. Regarding BIMSTEC, I don't really see the connection between the two. I don't think the EU has played any kind of obstructionist role. You see, the point is that when we are looking at the European Union, we are looking at an immensely complex architecture where you have the council, you have the parliament, you have the commission and you have individual member countries. I think you have to see where exactly their policies are going when their policies are translated into official policies. And their position on Myanmar certainly does not affect our relations with BIMSTEC or how BIMSTEC progresses. BIMTEC was launched seven years back. I was there in Bangkok as the Deputy Chief of Mission on the day that BIMSTEC was launched and I think that it has made remarkable progress for an organization that is so young. And I think you will see that it will have a lot to show by way of achievement in terms of transportation and in terms of other areas including energy, over the years. I think that if there is scope for cooperation with the EU then they will only be glad to do so. I don't have any doubts about that. Trade and investment again I wouldn't like to go into figures, but EU is our largest trade and investment partner, but there is one thing we are troubled with. As compared to the investment approvals, the actual investment flows are lower than we have compared to the ratios from other countries. Now, this is something we have put across to the EU and we have also suggested the setting up of some kind of group to go into the reasons why this is so, so that we can address their concerns and look at the ways and means of actually realising the various flows for which there is a potential.

On investment, I would definitely be able to com back to you with figures on the EU investment in India, but our investment is a different kettle of fish because in the UK it certainly is very large. In the UK we are the 8th largest investor, in Germany it is growing and as a matter of fact, the very interesting aspect that we see in our interactions with major EU countries is not just talking. In the Netherlands, when the Prime Minister was interacting with the CEOs, the CEOs were not just talking about investment over here in India, they were also asking for Indian investment in the European Union and the Netherlands. So, it is certainly becoming a significant feature of the economic landscape over there but to what extent I don't know. I think we have to get the figures from the RBI, etc.

Chair

I think we have covered your queries to the extent we can because there is a desire not to stand too long between you and dinner. I would only say that having been Ambassador to the European Union some more than 20 years ago, the change has been enormous. If I had thought then that you could have a summit in which the President of the Commission or the president of the Council would turn up in India with a troika, it was unthinkable in my times, So, the stature has grown enormously and of course so has the economic content of the relationship. But, in a sense my gut reaction is that great civilizations, such as the Europeans and the Japanese are always slow to convert investment ideas into investment approval. They are very cautious and careful. We have found that what I might say as slightly cowboy colonies, like the United States and the Koreans have more faith in India. And I think that if you look at the actuals, given what there is, you'll find that the Americans are better partners because they are quicker partners, and so are the Koreans. In fact, the Koreans have already reached a stage where we are beginning to talk on a global pattern. So I hope that Europe will not leave itself behind in this race because in a sense, you are so well off that you are so laid back that India is important but it is there, you know, let us not worry about it. I don't think you can afford to do this because someday India and China, we're going to leave Europe behind. At least I sincerely hope that this happens, maybe not quite in my lifetime, but very soon after that.

I would also like to leave one last thought with all of you. It is not a question of poles and so on, but we are undoubtedly in a globalised world. In this globalised world I think, if we do not coordinate sufficiently the globalisation of the economy, with globalisation of other items such as security and politics, we will find that somewhere there will be a disconnect as is happening in some areas and has happened earlier too. And this is where I think that middle powers and that is what India and Europe are at this moment. Middle powers have a role in this world; whether you want to call it poles or not poles, but I think that they have a requirement of trying to do something about trying to bring together some kind of rule based system in the political sphere just as much as you have a rule based system in the WTO. This I think is perhaps what might be a good point for a dialogue for your future meetings.