Angela Merkel visit: India, Germany to fast-track investment, revive EU-FTA talks

New Delhi: India has decided to fast-track investments from Germany by making it easier for German firms to get approvals and do business here, while the two countries also committed to soon resume negotiations for the stalled India-EU free trade pact.

To enhance economic ties, the two countries also renewed their determination to expand bilateral trade and investment.

German Chancellor Angela Merkel, who is in India on a three-day visit, welcomed Prime Minister Narendra Modi's "commitment to improve the ease of doing business in India and the Indian decision to set up a fast-track system for German companies in the Department of Industrial Policy and Promotion (DIPP)".

It will fully operationalised by March 2016, said a joint statement issued after a meeting between the two leaders and the third Inter-Governmental Consultations here between the two sides.

On the stalled talks on the proposed Free Trade Agreement between India and the European Union (EU), both the sides underlined their "strong commitment to the EU-India Broad Based Trade and Investment Agreement and committed to bring about a resumption of the negotiations as soon as possible".

After 14 rounds of talks till May 2013, India in August this year expressed disappointment and concern over the EU banning sale of around 700 pharma products clinically tested by GVK Biosciences and deferred talks for the proposed free trade agreement.

The FTA talks were first launched in June 2007 and have missed several deadlines.

"Both sides noted the potential of open markets for deepening trade relations and for attracting investments. They agreed to work closely towards achieving substantive outcomes in the 10th WTO Ministerial Conference in December in Nairobi, in conformity with the development mandate of the Doha Round and to bring the Doha Round to a conclusion," it said.

The two countries also encouraged the private sector to take advantage of these initiatives to enhance trade and investment.

The joint statement further said the two sides "agreed to work towards scheduling the next meeting of the Indo-German Joint Commission in India in 2016 to identify new areas for practical business cooperation."

Social protection and occupational safety issues will also remain on the agenda, bilaterally and in relevant multilateral fora.

Recognising Germany's key competence in technology and India's growing needs, Modi and Merkel reaffirmed that technology-intensive manufacturing can become a key pillar of their strategic partnership.

Acknowledging the importance of groups like Indo-German Energy Forum, the two leaders welcomed the efforts of the High Technology Partnership Group to identify specific opportunities for high technology collaboration, including in priority areas of manufacturing under the 'Make in India' programme, in particular defence manufacturing, through regular meetings.

"They agreed that new policies, including the 'Make in India' initiative, have the potential to open up investment opportunities for German companies," the joint statement said.

The leaders also welcomed cooperation in the area of vocational training and skills development by supporting policy reforms in the apprenticeship system including dual system pilot projects in selected industry clusters.

They supported the idea of German assistance for curriculum development and Vocational Education and Training (VET) as well as in helping India establish a National Institute for Skill Development for higher learning.

Both the sides agreed to hold the next Joint Working Group meeting on VET cooperation in 2016 in India.

In the field of transport, the statement said, the two leaders believe that India's railway modernisation and expansion plans open up commercial opportunities for German companies in high speed rail, station re-development, rolling stock manufacturing, logistics terminals and urged the private sector to explore early participation in this sector.

Training managers, supervisors and instructors from Indian Railways is another potential area of collaboration, it said. The two sides agreed that aviation industry also offers new opportunities for investments.

The two leaders asked their respective business enterprises to enter into arrangements for co-development and co-production of commercial aviation and defence equipment in India, including transfer of know-how and technologies.

They also took note of the resumption of negotiations for amending the existing Double Taxation Avoidance Agreement including the article on exchange of information to enhance the elimination of double taxation and to foster financial transparency.

Some of the suspected overseas black money cases being pursued by tax authorities in India are based on a list shared by the German government.

The bilateral trade between the countries stood at USD 20.32 billion in 2014-15. India has received USD 8.19 billion foreign direct investment from the European country during April 2000 and June 2015.

Germany accounts for about 3 percent of India's total FDI during this period.