New Delhi: Prime Minister Manmohan Singh on Wednesday left for Berlin on a three-day visit to Germany for the biennial Summit with the country, which is a key player in the European Union(EU), the 27-nation bloc of European nations.
The visit comes at a crucial time when negotiations with the European Union(EU) for a Free Trade Agreement were at a very advanced stage, and when it had become imperative for India to convince the European investors that it has a roadmap for reforms.
The fourth largest economy in the world with a GDP of US 3.5 trillion dollars and contributing about 20 per cent of the European Union budget, Germany is India’s biggest trading partner in Europe, its 5th biggest trading partner in the world.
Dr Singh, who is accompanied by a battery of senior Cabinet Ministers, will also use the opportunity to clarify to Germany the steps taken by his government for furthering the reform agenda and for improving the climate for investment.
This would be the second round of Inter-Governmental Consultations(IGC) with Germany, a format of very high-level of engagement which Germany has with only two other countries in Asia — China and Israel.
The first round of IGC was held when German Chancellor Angela Merkel visited India in May 2011.
Foreign Secretary Ranjan Mathai said here that FTA with EU would of course be on the agenda of the talks with German leaders. He said it was in the interest of both countries that the FTA was signed as it would open new opportunities for both.
The Germans feel that the negotiations for a FTA with EU had dragged for too long and it was high time that the deal must be clinched. But at the same time they have made it clear that without an agreement of increasing FDI in insurance, such an FTA would not be possible, a demand on which India finds hard to obtain political consensus.
A bill on increasing foreign equity in Insurance is pending for clearance by Parliament. Besides insurance and automobiles, EU also wants concessions for its wines and spirits, while India wants an opening for its services sector. Besides, it is also demanding that EU give it data-adequacy status. After the country is declared data-safe, it would help its IT and outsourcing industry.
As for Germany it is also pressing for substantial reduction in duty in import of its cars.
The Prime Minister will be taking National Security Adviser Shiv Shankar Menon and five Cabinet Ministers with him. These are External Affairs Minister Salman Khurshid, Minister for Commerce and Industry Anand Sharma, Minister for HRD MM Pallam Raju, Minister for Science and Technology Jaipal Reddy, Minister for Renewable Energy Farooq Abdullah. The NSA will participate in the Strategic Dialogue. (UNI)