India and the EU are holding a crucial dialogue on connectivity and building infrastructure in the Indian subcontinent under the Global Gateway (GG) Conference. Based on the three pillars: Digital, Energy and Transport, the talks will unfold new possibilities in the region. Will the GG be able to forge an economic partnership while the key issues of financing and investment remain to be resolved?
The Ministry of External Affairs, the EU Delegation to India and the Asian Confluence are jointly organizing the India – EU Connectivity Conference in Meghalaya on 01 – 02 June 2023. The conference’s objective is to explore possibilities of boosting connectivity investments in India’s North Eastern States and with India’s neighbours (Nepal, Bhutan and Bangladesh).
The Conference is an outcome of the India – EU Connectivity partnership which was launched during the India – EU Leaders’ Meeting in May 2021.
The Conference would focus on connectivity through three pillars namely: Digital, Energy and Transport with an aim to identify concrete projects for joint implementation. This was also identified as a key deliverable in the recently concluded Ministerial Meeting of the India – EU Trade and Technology Council (TTC).
The Global Gateway is unfolding a new kind of economic partnership with India. Will it be able to forge such a partnership and how?
Global Gateway: Connectivity for Asia
When PM Modi visited Germany, he focused on economic and scientific collaboration with the EU. Prime Minister’s first meeting with Chancellor German Chancellor, Olaf Scholz largely revolved around the economic partnership.
The talks led to a critical discussion on India’s global outlook in search of better and bigger trade and investment partners with the EU.
One that is important to highlight is the Joint Declaration of Intent (JDI) on the implementation of Triangular Development Cooperation projects in Third Countries between India and Germany. Leading on this, India’s foreign minister S Jaishankar agreed to evaluate such economic outreach with Svenja Schulze, Federal Minister for Economic Cooperation and Development.
The concept led to the “Global Gateway” – an infrastructural and connectivity development program. Global Gateway (GG) is the EU’s €300 billion international investment project. This is the biggest investment roadmap ever.
In terms of financial commitment, several agencies within the EU–the Neighbourhood, Development and International Cooperation Instrument (NDICI)-Global Europe, InvestEU and European Fund for Sustainable Development all together commit upto €135 billion for guaranteed investments for infrastructure projects between 2021 and 2027.
Why is it needed?
Global Gateway is intended to shape and redefine the norms of global infrastructure projects from Asia to Africa.
At the heart of the GG is the connectivity that puts India at the centre stage amidst ongoing great-power competition. It derives its strength from the EU Strategy for Cooperation in the Indo-Pacific which was laid down by European Council in April 2021.
The joint communication on the strategy, released in September, highlighted seven priority areas for action: “Sustainable and inclusive prosperity; green transition; ocean governance; digital governance and partnerships; connectivity; security and defence; and human security.
Under the GG, the EU is also finding ways to embrace opportunities for Indian infrastructure developmental projects and connectivity in the Indian subcontinent.
India’s position on the Global Gateway
As Foreign Secretary Vinay Kwatra in an interaction with the author, outlined: “You’re all very well familiar that India and EU have a very strong element of connectivity partnership. And this connectivity partnership structures across a range of areas, you could call it infrastructure connectivity, digital connectivity, financial connectivity, and physical connectivity across a range of areas. Now, Global Gateway is an EU initiative and I think that is something on which the EU would be a far better place to elaborate on.”
While the EU-India dialogue under the GG is still confined within the stretch of the Indian subcontinent, questions remain if India could directly participate in such a global alliance.
In that case, it opens opportunities to plan and implement big-scale global projects with the consortium of EU countries.
Fundamentally, the initiative seeks to align on mutual development and transparency in taking up global projects.
As the emphasis of such alignment remains on financial transference and accountability, it certainly hints at countering the troubled Chinese Belt and Road Initiative (BRI) which has received flanks for its dubious financing and investment, leading to the ‘debt trap’ for many countries across Asia and Africa.
The EU-India connectivity collaboration also takes account of Indian investment and outreach in Asia and Africa which is now seen as the model for sustained development.
However, for India, the problem is with the scale and limitation of funding.
Foreign secretary Kawatra builds up on such goodwill, further clarified: “I think all connectivity initiatives that essentially promote and bring together the countries of the region in a manner which promotes development partnership, which promotes the development of connectivity related linkages between their economies would always be welcome.”
“Of course, within the overall space of Global Gateway, how individual connectivity projects get structured, between the EU countries and India would essentially be a derivative of terms and conditions on which those are shaped and developed. I think that’s what I would like to convey on how we look at Global Gateway.”
However, at this stage of initial talks, key issues like the financing mechanism still need to be worked out.
“It is a work in progress and the conference will unfold if such things happen within the framework of India-EU connectivity dialogue,” clarifies MEA spokesperson, Arindam Bagchi.
Besides, even within the EU, consensus-building is a difficult task on such initiatives where large-scale funding and investment are required.
“Despite good intentions and fruitful dialogue, it is always a long bureaucratic process,” explained a former ambassador who worked very closely with the EU.
However, the dialogue on crucial issues of connectivity and infrastructure building in the region is a progressive step.
“This is a clear indication that India is ready to embrace economic diplomacy and play a much greater role in shaping and connecting regions, way beyond Asia to Africa,” said the former economic secretary of India.
While still cautious—rightly so—against the current geological conflict, Vinay Kwatra puts forth in agreement as to how will it unfold, “It will ultimately be a question of specific projects that emanate out of Global Gateway and connect well to the overall India-EU connectivity partnership also.”
The Conference would be led by Conrad Kongkal Sangma, Chief Minister of Meghalaya and Rajkumar Ranjan Singh, Minister of State for External Affairs along with Senior officials of the Government of India, EU Commission, Government(s) of Nepal, Bhutan and Bangladesh.
