New Delhi: Shoring up bilateral ties in trade, investment, critical technologies and defence are set to be the focus of wide-ranging talks between Prime Minister Narendra Modi and German Chancellor Friedrich Merz in Ahmedabad on Monday.
As Merz’s trip to India is taking place amid a fractious geopolitical environment, including the US’s display of raw military strength to capture Venezuela’s President Nicolas Maduro, the German leader and Modi are also likely to discuss pressing global challenges.
Merz’s January 12-13 visit to India will be his first to Asia as the German Chancellor.
Ways to bring peace to Ukraine may also figure prominently in Modi-Merz talks.
The German leader will travel to Bengaluru after concluding his engagements in Ahmedabad.
Besides holding talks with PM Modi, Merz is scheduled to visit the Sabarmati Ashram, participate in a kite festival and attend a skill development event in Ahmedabad, according to officials.
In their talks, Modi and Merz are likely to deliberate on trade and investment ties as New Delhi is looking at deepening economic engagement with Europe against the backdrop of Washington’s 50 per cent tariff on Indian goods, people familiar with the matter said.
Germany is one of India’s most important partners in Europe. It is New Delhi’s largest trading partner in the European Union and the bilateral trade in goods and services between the two countries reached USD 51.23 billion in 2024-25.
Germany accounts for roughly one-fourth of India’s trade with the EU, reinforcing its position as New Delhi’s leading EU trading partner. The Indo-German trade in services rose by 12.5 per cent in the financial year 2024-25, reaching a record USD 16.65 billion.
The influential European nation is the ninth largest foreign direct investor in India, with cumulative FDI inflows of USD 15.40 billion from April 2000 to June 2025. More than 2000 German companies are currently operating in India.
Days after Merz’s trip, the top leaders of the European Union will visit New Delhi during which the two sides may announce finalisation of the much-awaited India-EU free trade agreement.
India will host French President Emmanuel Macron next month. Macron is visiting India to participate in the AI Summit.
Defence and security ties between the two countries have also been on an upswing. With the easing of export control and expeditious clearing of cases, defence exports from Germany to India have increased.
Both sides have a joint working group on counter terrorism. Germany will be deploying a German Navy liaison officer in India’s Integrated Fusion Centre – Indian Ocean Region (IFC-IOR).
There has been speculation that India and Germany may finalise an inter-governmental agreement during Merz’s visit for supplying six stealth submarines to the Indian Navy.
German defence major ThyssenKrupp Marine Systems (TKMS) and Mazagon Dock Shipbuilders Ltd (MDL) are holding price negotiations with the defence ministry for an Euro 5 billion deal to supply six stealth submarines to the Indian Navy.
The deal is being billed as one of the biggest ‘Make in India’ projects in recent years.
The India-German relations are also expanding in a number of other areas, including education, energy, skill development, culture, people-to-people exchanges and technology.
In 2024, the two sides launched the Indo-German green hydrogen roadmap that was aimed at supporting India’s ambition for production, usage and export of green hydrogen.
The people cited above said enhancing cooperation in critical technologies may figure prominently in the talks between Modi and Merz.
India and Germany firmed up a strategic agenda to enhance Indo-German partnership in the 21st century in 2000. The strategic partnership completed 25 years last year.
Since 2011, the top leadership of the two sides has been undertaking a comprehensive review of cooperation through the Inter-Governmental consultation (IGC framework). The seventh IGC was held in New Delhi in 2024.
