Amid Germany’s pressing need for skilled labour, upcoming talks between Prime Minister Narendra Modi and Chancellor Olaf Scholz are expected to concentrate on two major topics: the movement of Indian talent to Germany and the long-discussed India-EU Free Trade Agreement (FTA). With Germany facing a workforce shortage, these discussions which will take place in New Delhi on Friday (Oct 25, 2024) are seen as a critical step in addressing both nations’ economic and trade priorities.
India-EU Free Trade Agreement: A Key Focus
Germany, India’s largest trading partner within the European Union, has been a strong advocate for the India-EU FTA, which has been under negotiation since 2007. Jürgen Ratzinger, Managing Director of International Business at the Frankfurt Chamber of Commerce and Industry, emphasized the importance of the deal, stating, “The business community is strongly favouring the India-EU trade agreement. India is an important trading partner and the potential is huge. We want to tap into that growth story from India.”
According to information in the public domain, in 2023-24, two-way trade between India and Germany reached $26.48 billion. However, the FTA, once finalized, could significantly boost trade between India and the EU, removing barriers for businesses and simplifying regulations, especially for small and medium-sized enterprises (SMEs). Ratzinger expressed the need for clear, easier rules, saying, “This should be high on the agenda of the talks to get rid of the things in question and [that] are still not resolved.”
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The FTA is expected to facilitate deeper cooperation in various sectors, particularly innovation, research, and development. Ratzinger noted, “Cooperation in innovative sectors should be given focus. Both leaders are going to talk about the movement of talent across the borders. That’s very important.” These discussions will likely lead to smoother collaboration, benefiting industries on both sides.
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Addressing Germany’s Skilled Labor Shortage
Germany is also facing a critical shortage of skilled labour,
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