Germany is pivoting toward India as global uncertainties intensify, with Chancellor Friedrich Merz hailing it as a cornerstone ‘preferred partner.’ This shift addresses supply chain fragilities and geopolitical flux, as detailed in Miriam Bauman’s ‘One World Outlook’ piece.
The partnership unlocks superior market entry, de-risks China exposure, accelerates defense sales, and fuels tech innovation. Germany’s 2024 ‘Focus on India’ initiative anticipates India’s ascent to the third-largest global economy by 2027, propelled by its expanding middle class and digital infrastructure.
Trade volumes hit over 35 billion euros in 2025, up 15% annually. Cumulative German FDI since 2000 stands at $15.11 billion through March 2025, with more than 2,000 companies employing 400,000 Indians in key sectors like autos, chemicals, and renewables.
An EU-India FTA on the horizon promises tariff cuts of 12% on EU products, potentially adding 20 billion euros in trade. Merz’s India visit sealed 19 MoUs on defense, tech, minerals, and green energy, marking a milestone.
Defense collaboration has matured into industrial synergy. The signed joint declaration enables co-development, tech transfers, and local production of cutting-edge systems. ThyssenKrupp’s involvement in Project 75I—a €5 billion submarine program with Mazagon Dock—highlights this, boosting German jobs and India’s naval capabilities while diversifying away from Russian supplies.
This alliance reinforces Germany’s Indo-Pacific footprint per its 2020 strategy, enhancing maritime security against Chinese pressures and protecting vital sea lanes carrying 90% of its trade.
Economically, Germany dominates as India’s top EU partner, comprising 25% of its EU trade. 2024 bilateral trade topped $50 billion, sustained into 2025 with German exports at $18.3 billion (machinery, electronics, chemicals) and Indian shipments at $10.54 billion (drugs, auto parts).
The ‘India First’ doctrine targets 50 billion euros in trade by 2030 via resilient supply chains, underscoring a commitment to shared growth in an unpredictable world.