Why in News?

• German Chancellor Friedrich Merz’s first visit to India and Asia coincides with 25 years of India–Germany Strategic Partnership and 75 years of diplomatic relations.
• The visit precedes the EU leaders’ visit for India’s Republic Day and the India–EU Summit.
• Outcome-driven diplomacy with the signing of 19 agreements/MoUs, signalling deepening strategic, economic and geopolitical convergence.

What’s in Today’s Article?

• Key Outcomes of the Visit
• Major Areas of Cooperation
• Current State of India–Germany Relations
• Challenges and Way Ahead
• Conclusion

Key Outcomes of the Visit:

• 19 bilateral pacts signed, covering:
  • Defence industrial cooperation
  • Higher education and global skills
  • Critical minerals and semiconductors
  • Indo-Pacific dialogue
  • Renewable energy and green hydrogen
• Visa-free transit regime for Indian passport holders transiting through German airports.
• Announcement of a new bilateral Indo-Pacific consultation mechanism.

Major Areas of Cooperation:

• Strategic and defence cooperation:
  • Key developments:
    • Joint Declaration of Intent (JDoI) on a Defence Industrial Cooperation Roadmap.
    • Focus on: Co-development and co-production, technology partnerships, and faster defence export clearances from Germany.
  • Ongoing defence collaboration: Submarines, obstacle avoidance systems for helicopters, Counter-Unmanned Aerial Systems (C-UAS), joint Air Force and Naval exercises, port visits and new security consultation formats.
  • Strategic significance:
    • Defence indigenisation, Atmanirbhar Bharat, strategic autonomy, and co-production.
    • Reduces India’s defence dependence on Russia, and leverages -
      • India’s skilled workforce and cost advantage
      • Germany’s advanced technology and capital
• Higher education and global skills partnership: It focuses on human capital, skill mobility, aligning with NEP 2020, and demographic dividend, with following initiatives -
  • Comprehensive roadmap on higher education: India invited German universities to open campuses in India.
  • Global skills partnership (JDoI): Facilitates mobility of healthcare professionals.
  • Proposal to expand German language teaching in: Schools, Universities, and Vocational institutions.
  • New initiative: Indo-German Centre of Excellence for Skilling in Renewable Energy - curriculum development, industry collaboration, job-market-oriented training.
• Economic and trade relations:
• It focuses on supply chain resilience, Trade diversification, and FTA diplomacy. Bilateral trade between India and Germany crossed USD 50 billion in 2024 (over 25% of India–EU trade).
• Strong two-way investments supporting supply chain diversification, SMEs, startups, digitalisation, AI, and innovation.
• Institutional mechanism - Strengthening cooperation via the German–Indian CEO Forum.
• FTA push: Strong support for concluding the India–EU Free Trade Agreement, seen as a key deliverable of the upcoming EU–India Summit.
• Critical and emerging technologies:
  • Focus areas: Semiconductors, critical minerals, telecommunications, digitalisation and AI, health and bioeconomy.
  • Key institutional steps: JDoI on Semiconductor Ecosystem Partnership, JDoI on Critical Minerals Cooperation, Indo-German Digital Dialogue Work Plan (2026–27), and JDoI on Telecommunications.
  • Strategic importance:
    • Trusted supply chains, critical technologies, and digital sovereignty - reducing dependence on China-dominated supply chains.
    • Supporting India’s ambitions in electronics manufacturing and Industry 4.0.
• Climate, energy and sustainability:
• Establishment of India–Germany Centre of Excellence in Renewable Energy.
• Joint projects in climate action, urban development and mobility, and green hydrogen (mega project).
• Strategic alignment - Clean energy transition, climate diplomacy (climate finance and technology transfer), and long-term energy security.
• Indo-Pacific and global geopolitics:
  • Reaffirmed commitment to Free and Open Indo-Pacific, UNCLOS and international law.
  • Germany’s growing engagement under the Indo-Pacific Oceans Initiative (IPOI) (co-led by India & Germany).
  • Global Issues discussed:
    • Ukraine war: Support for a just and lasting peace under the UN Charter.
    • Gaza conflict: Support for a negotiated two-state solution.
    • Strong condemnation of terrorist attacks in Pahalgam and Delhi.
• Multilateral cooperation (Global governance reforms, Multilateralism, G4): Renewed commitment to UN Security Council (UNSC) reforms. Continued coordination through the G4 group (India, Germany, Japan, Brazil).

Current State of India–Germany Relations:

• Institutional architecture: The Inter-Governmental Consultations (IGC) mechanism—used by Germany with only a few select partners—anchors policy coordination and makes India–Germany ties among the most institutionalised in Europe–India relations.
• Trade and investment depth: While over 2,000 German companies operate in India, supporting around 4 lakh jobs; Indian investments in Germany have crossed €6.5 billion, reflecting two-way economic interdependence.
• Project 75I Submarine Programme: The project involves AIP-enabled submarines, over 60% indigenisation, major technology transfer, and is central to India’s Indian Ocean deterrence strategy amid China’s naval expansion.
• Science & technology legacy: India and Germany marked 50 years of formal S&T cooperation in 2024, which is now being scaled up to strategic domains such as quantum tech, cybersecurity, biotech and AI.
• Green financing commitment: Under the Green and Sustainable Development Partnership (2022), Germany has committed up to €10 billion till 2030 for India’s green transition.
• Mobility and migration framework: The Comprehensive Migration and Mobility Partnership (2022) and Germany’s Skilled Immigration Act have made Germany a major destination for Indian talent, with -
  • Around 2.8 lakh Indians residing in Germany (2025)
  • India as the largest source of international students in Germany (over 42,000 students)
  • Special focus on healthcare, STEM and technical professionals
• Essence of India–Germany relations today: It rests on a deeply institutionalised, multi-layered partnership, positioning Germany as India’s most consequential partner within the European Union.

Challenges and Way Ahead:

• No concrete breakthrough yet on submarine deal: Operationalise defence industrial roadmap with flagship co-production projects.
• Divergences on some geopolitical issues persist: Deepen Indo-Pacific coordination amid rising great power competition.
• Translating MoUs into time-bound implementation: Institutionalise semiconductor and critical minerals cooperation.
• Aligning EU regulatory standards with Indian market realities: Fast-track India–EU FTA conclusion.
• Slow education and skills partnership: Expand German educational presence under NEP 2020. Ensure skill mobility agreements are mutually beneficial and ethical.

Conclusion:

• The Merz–Modi summit marks a qualitative upgrade of the India–Germany Strategic Partnership, moving beyond trade to encompass strategic sectors like defence manufacturing.
• As global geopolitics undergoes rapid realignment, India and Germany emerge as natural partners anchored in shared democratic values, economic complementarities and a commitment to a rules-based international order—making this partnership a key pillar of India’s Europe and Indo-Pacific strategy.