Is it a good time to tap in to the euro block: India business initiative? By Dr. Bobby Srinivasan and Dr. Sudhakar Balachandran

April 7, 2015 | Posted by bobbysrinivasan << back to blog

As a bloc, the 28 member EU area is India’s largest trading partner. The two way trade between them has crossed US $ 100 billion during the financial year 2014. What does India need at this point from the EU? We need a Foreign Trade Agreement (FTA) with their member countries. The EU has already agreed to have FTA’s with South Korea, Canada, Mexico and China and are currently in negotiations with Japan and the US. Isn’t it time that India took the initiative to open up discussions with these countries.

India has many challenges to tackle in the near term. We have 1.1 crore youth looking for jobs. We need the technology of the EU area countries in the areas of smart grids, energy, renewables and hydro power etc. In India, small and medium sized businesses where the greatest opportunities for growth lie rather than in large scale infrastructure projects where there is so much money already locked up with large sunk costs.

What should the Indian leadership do? First we must set our priorities right and use to benefit from the depreciating euro zone currencies. It is possible to buy technology at a relatively low cost. Next, given the low cost we can send our technicians to the euro zone countries and have them trained at a minimal cost. Indian companies could use this opportunity to buy up European companies or enter into a joint partnership.

Indian economy is currently operating under its potential. The manufacturing sector is in dire straits looking for both investment and technology to increase its productivity. We have land reform bills pending in the parliament. The opposition parties are ganging up against the Modi government. In the meanwhile, our public image about our country is being badly hurt. The result is stagnation and low opportunities for growth.

What is needed is the true grit and a deep desire to get ahead accepting challenges. The world owe us nothing. How do we convince the European Union to have a bigger presence in the Indian manufacturing diaspora. The just passed away great architect and a phenomenal leader of Singapore Mr. Lee Kuan Yew said several years ago and I quote “Adapt and adjust without any whimpering or wringing of hands. The world does not owe us a living and … we cannot live by the begging bowl”. It is time our leaders show that they can lead. In the upcoming meeting with German Chancellor Angela Merkel, our Prime Minister should convince her that India will be more than happy to have a FTA with them. If he did and succeed we can be assured that it will be a win win situation for both the countries.

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