K.C. Singh | Can India, Germany, EU Be Core of a Third Pole?

German Chancellor Friedrich Merz’s just-concluded visit to India on January 12-13 holds special significance, beyond celebrating the 75th anniversary of bilateral diplomatic relations or the 25th anniversary of the Indo-German strategic partnership. The recent summit addresses how India and Germany propose traversing a world disrupted by US President Donald Trump. The post-Second World War rules-based global order is, ironically, being unravelled by the leader of a nation which had helped formulate it.

An Indo-German joint statement on January 12 lists the areas of potential engagement. It covers the following: “Defence and Security”; “Trade and Economy”; “Technology, Innovation, Science & Research”, “Green & Sustainable Development Partnership/Renewable Energy”; “Indo-Pacific, Connectivity & Global Issues”. There is emphasis on undertaking climate-friendly energy transition, including the production of green hydrogen. The Trump administration has abandoned the Paris climate accord, adopting instead regressive oil and gas extraction policies. In fact, in keeping with his slogan “Drill, Baby Drill”, voiced before assuming office, oil and gas drilling permits have surged by 55 per cent. The withdrawal of the United States from the India-sponsored International Solar Alliance underscored the altered priorities.

Germany, in the decades after the Second World War and the Cold War, generally kept defence spending low, relative to its economic power. It focused on integration within Nato. Given its destructive historical role, its allies and neighbours did not complain. In 2014, Germany concurred with its Nato allies to ramp up defence spending to two per cent of GDP, then just over one per cent. The Russian invasion of Ukraine in February

2022 shook Germany out of its complacency. President Donald Trump’s “America First” isolationism, his diplomatic flirtation with Russian President Vladimir Putin and now the threat to grab Greenland, forcibly if needed, leaves Germany no option but to become much more assertive.

The joint statement outlines prospective defence industrial cooperation, emphasising co-development and co-production. India’s purchase of HDW German submarines in the 1980s had led to a massive political controversy over corruption allegations. After a 10-year delay India may now buy six AIP German submarines in a deal worth $8 billion. Additionally, the document lists obstacle avoidance systems for helicopters and weapons to counter unmanned aerial systems. The interest in new defence technologies addresses the revolution in war fighting, seen both in Ukraine or India’s Operation Sindoor.

Trade and commerce are important for all nations, but the new arbitrary tariffs ordered by President Trump have created a unique crisis. The Trumpian tariffs aim to compel friends and foes to abide by America’s trade-related or strategic goals.

Indo-German trade topped $50 billion last year. There are over 2,000 German companies operating in India. German foreign direct investment in India in the period 2000-25 totals $15.4 billion. Conversely, 200 Indian companies are operating in Germany. The delayed Free Trade Agreement between India and the European Union (EU) has been a hurdle. Germany absorbs a quarter of all Indian exports to the EU. The over-dependence on the US market is proving costly for all nations, though for some like Canada and Mexico it is more damaging. For India and Germany too, it is a wakeup call.

It is not surprising that the European Union leaders are the chief guests at this year’s Republic Day celebrations in India. Immediately following that the India-EU summit will take place. This reflects that a multipolar world, advocated by India for decades, is achievable only if principal powers quickly create new supply lines and manufacturing hubs.

The German demand for skilled workers is proving a boon just when the Anglophone nations, especially America, are allowing xenophobia to tighten immigration policies. Indian students in Germany, numbering 60,000, are the largest international group. Most of them are pursuing engineering or information technology courses. Low education fees and easier transition to work visas is luring foreign students. The danger is the rise of the far-right parties in major European nations, which are anti-immigration. The estimated support for the National Rally in France is 33.4 per cent, while Germany’s AfD scores 26 per cent. In the latest US National Security Strategy document, that was released on December 4-5, support is extended to these far-right groups, employing the freedom of speech argument.

Geo-strategically, India and Germany have areas of congruence as well as dissonance. Regarding Ukraine, India has avoided condemning Russia, while for the European nations it is an existential issue. Chancellor Merz strongly supports sanctions on Russia. He has also publicly decried the threat to a “liberal world order”, both from outside and within Europe. Speaking at Korber Foundation in January 2025, he urged Germany to transform from “a sleeping to a leading middle power”. Fortunately for the Chancellor, the debt-brake on defence

spending was lifted before he assumed office. This gives him freedom to move Germany towards strategic autonomy.

On the Gaza issue, the positions of India and Germany are now converging. That is why the joint statement calls for a two-nation solution for stability and peace. But at one stage, Chancellor Merz took an odd position on Israel’s brutal assault on Hamas, irrespective of the harm to civilians. He had praised Israel’s Prime Minister Benjamin Netanyahu for doing the “dirty work” of Germans or the West.

India and Germany have dealt with President Trump in their own way. Chancellor Merz chose, like other European leaders, to avoid confrontation while politely correcting publicly misstated facts. Prime Minister Narendra Modi has avoided direct contact, to minimise the possibilities of a public spat. However, President Trump’s reiterated desire to occupy or annex Greenland is putting EU and Nato members in a quandary. Forcible occupation by America can destroy Nato, besides raising the possibility of an armed confrontation.

India and Germany have for well over two decades been a part of G-4, alongside Brazil and Japan. The group has campaigned for major reform of the United Nations Security Council, especially the addition of new permanent members. Germany seemed to step back after Chancellor Angela Merkel took office. The joint statement reflects revived enthusiasm of India and Germany to crusade for permanent membership.

Closer Indo-German engagement, especially with enhanced ties in the defence and emerging technologies sectors, can create a “third global pole”, which draws other EU members and middle powers to its corner. The United States and China are set for a new bipolarity. The world needs to offset that with a pole that is committed to a reformed version of the old rules-based liberal international order.