by Rajnish Singh*
The 26 January 2025 marked India’s 76th Republic Day anniversary when the country formally adopted its constitution. Despite gaining independence from the UK in 1947, it did not completely become a sovereign democratic republic until 1950, when the Indian constitution was enacted.
Despite facing many domestic and economic challenges, in those 76 years, India’s global power and economy have grown rapidly.
Unlike other former colonies, to its credit politically it has remained a functioning multiparty democracy, as seen by its ability to carry out the world’s biggest election in 2024, where 1.4 billion people were involved.
It is currently the fifth biggest economy, overtaking the UK, with annual growth rates above Japan and Germany. Some predict it could be the third biggest in less than five years.
Though having a larger population than China, average individual wages are still lower, but India’s population is much younger- a huge potential market of consumers for any exporters.
Strategically India is increasingly seen by the West not only as a superpower in South Asia but also as a major military and political counter to the rise of China in the Indo-Pacific region.
Therefore India had much to celebrate on its Republic Day anniversary.
However US President Donald Trump’s announcements in the last couple of days signalling protectionist and tariff policies have caused waves of anxiety in New Delhi.
India currently enjoys a trade surplus with the US, but Trump’s approach to trade is feared can undermine Prime Minister Narendra Modi’s flagship economic policy, ‘Make in India’, particularly as Trump seeks to regenerate manufacturing in the US.
The EU faces a similar headache as it also enjoys a trade surplus with the US. Furthermore, Trump has made no secret of his disdain for the trading and political bloc.
This has finally prompted Brussels to recognise India’s strategic importance as a counterbalance to China and the US.
European Commission President Ursula von der Leyen announced at the World Economic Forum, in Davos that her first international visit of her new term will be to New Delhi.
“Together with Prime Minister [Narendra] Modi we want to upgrade the strategic partnership with the largest country and democracy in the world,” she told the attendees.
But of course, the big prize to any partnership is a free trade agreement (FTA). After years of being in the negotiating doldrums, Trump’s election as US president may have given the talks between the EU and India, a much-needed focus, or the proverbial ‘kick up the arse’.
The US president believes he is both a disruptor and a deal maker – now could be the time for the bureaucrats in New Delhi and Brussels, to shake off their lethargy and act rapidly to get an FTA, otherwise the ‘The Donald’ could outsmart them.
*Brussels based journalist writer on EU-India relations
By: N. Peter Kramer
