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Asia-pacific

Trade, nuclear power deals top Sarkozy’s India wish list

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Video by Louise Hannah

Text by Leela JACINTO

Latest update : 2010-12-05

French President Nicolas Sarkozy is on a four-day trip to India seeking to secure French firms billions of euros in trade and defence deals and to enhance nuclear power cooperation between the two nations.

French President Nicolas Sarkozy is on a four-day trip to India aimed at boosting bilateral trade and shoring up defence and civilian nuclear power sharing agreements with the world’s largest democracy.

SARKOZY'S INDIA AGENDA:

Saturday, Dec. 4

- Visit to the Indian Space Research Organisation in Bangalore.

Sunday, Dec. 5

- Private visit to the historic Taj Mahal and Fatehpur Sikhri citadel in Agra
- Dinner in New Delhi with Indian Prime Minister Manmohan Singh. All eyes on Mrs. Sarkozy’s evening dress.

Monday, Dec. 6

- Delegation level talks at Hyderabad House followed by signing of agreements.
- Working lunch with Indian PM.
- Joint press conference with Indian PM.
- Meeting with Indian President Pratibha Patil

Tuesday, Dec. 7

- Visit to Mumbai, tributes to victims of 2008 terrorist attacks, terrorism speech at Oberoi Hotel, where two French citizens died in the attacks.
- Business dominates trip to Indian commercial capital with an address at Indian-French economic summit.
 

Sarkozy’s visit started Saturday at the state-run Indian Space Research Organisation (ISRO) in the southern city of Bangalore, a technology hub that has been dubbed “the Silicon Valley of India”.

French-Indian space research collaborations currently include the Megha-Tropiques Mission, a collaborative effort between ISRO and French Centre National d’Etudes Spatiales (CNES) to study the water cycle in the tropical atmosphere in the context of climate change.

Sarkozy’s latest trip to India comes amid a rash of visits by world leaders eager to enhance bilateral trade with the fast-growing South Asian nation.

India may not be as rich – or efficient – as arch-rival China, but many economists believe that with its expanding economy, population and intellectual base, it will surpass China by the end of the decade.

Doubters – if there are any – of India’s growing clout on the international scene need only look at the recent guest list at Hyderabad House, the plush former palace in New Delhi used for official events.

Early last month, US President Barack Obama met with Indian Prime Minister Manmohan Singh in the landmark domed edifice. Weeks after Sarkozy’s Dec. 4-8 visit, Russian President Dmitry Medvedev is set to visit India, which will then be followed by Chinese Premier Wen Jiabao’s trip in the last week of 2010.

“The leaders of four permanent UN Security Council members are coming to India in less than two months,” notes the Chennai-based French expert and author Claude Arpi. “That’s a recognition of the importance of India.”

The length of Sarkozy’s latest visit, his jam-packed agenda and the sheer size of the contingent on the French presidential plane is another indication of growing global weight of the country.

Unlike his brief 2008 visit, Sarkozy’s four-day trip this time features visits not only to New Delhi but also to Mumbai, where he will see the sites of the 2008 terrorist attacks.

The presidential entourage includes his wife, Carla Bruni-Sarkozy, and a bevy of French industrialists as well as seven ministers – including Defence Minister Alain Juppe, Foreign Minister Michele Alliot-Marie and Economy Minister Christine Lagarde.

On Monday, Sarkozy will meet with the Indian prime minister in New Delhi. The final two days of Sarkzoy’s visit will be devoted to political ceremonies as well as efforts to boost bilateral trade and defence cooperation.

What's on the agenda:

INTERNATIONAL ISSUES

This is Sarkozy’s first foreign visit in his new role as G20 chairman. Unlike Obama’s visit, which focused on economic ties, the French presidential trip will feature broader global issues.

France has long supported India’s bid for a permanent seat on the UN Security Council, a move vehemently opposed by neighbouring China and Pakistan. India has actively endorsed Sarkozy’s ambitious G20 agenda, including reforming the international monetary system, addressing the volatility in commodity prices and restructuring global governance.

NUCLEAR TECHNOLOGY

France has been a loyal partner in India’s nuclear history in good times and bad, a record New Delhi does not forget even as a US civilian nuclear deal with India has grabbed the international headlines.

After all, France was one of the few nations that did not condemn India’s controversial May 1998 nuclear tests. France was the also first country to sign a civilian nuclear deal with India, following the 1998 tests, as other world powers such as the US slapped technology-related sanctions against New Delhi.

Under a 2008 deal between French nuclear giant Areva and its Indian counterpart, NPCIL (Nuclear Power Corporation of India Limited),  Areva will contribute to building as many as six nuclear plants in western India. But according to Arpi, there are several outstanding issues in the long, complex agreement that have still to be ironed out.

In his remarks to the press, the Indian ambassador to France, Ranjan Mathai, has maintained that negotiations are proceeding smoothly, although he admitted that “issues related to the cost or the technical aspects of the project”, such as safety and liability, need “to be sorted out”.

The Indian Parliament has recently passed the Nuclear Liabilities Bill, which is expected to help tackle the complicated issue of responsibilities between French supplier Areva and Indian operator NPCIL, as Arpi notes in a blog posting.

UPGRADING MIRAGES

French firm Dassault Aviation is hoping to pick up a $1.2-billion contract to revamp 56 Mirage-2000 aircraft that France sold India nearly two decades ago. Shortly before Sarkozy’s visit, Indian officials played down expectations on this front, telling reporters that there may not be a deal on the Mirage upgrade during Sarkozy’s visit. Pricing, it seems, is the major stumbling block, with Indian officials trying to bargain down Dassault’s estimates. It remains to be seen if the French president can seal a deal on this one.

RAFALES FOR SALE

Arms-hungry India is expected to spend around $112 billion on defence acquisitions by 2016, and Paris would like to see its Rafale fighter jet feature in the acquisitions, despite the King of Bahrain’s dismissive “yesterday’s technology” quip about the Rafale, which was revealed in the latest WikiLeaks documents.

The competition, however, is intense, with US F-18 fighter jets, Russian MiG-35s and Eurofighters all in the race.

OTHER DEFENCE DEALS

France and India currently have a joint project to manufacture six Scorpene submarines at the Mazagon docks near Mumbai. The deal now needs to proceed to a second phase, which would take further negotiations.

New Delhi is also looking to buy reconnaissance and observation helicopters, and French companies are expected to place bids.

The two countries are also expected to pursue joint research and development deals in the area of surface-to-air missiles.

BILATERAL TRADE

In 2008, when Singh visited France during the July 14 Bastille Day celebrations, the two leaders set a 12 billion euros bilateral trade target to be reached by the end of 2012. While the economic crisis in Europe imposed a setback in 2008, experts believe the two countries are on track to reach their target.

While there are more than 300 French companies operating in India, France is only the seventh-largest investor in India, behind Germany and the United Kingdom.

With his delegation of top CEOs, including heads of Areva and Dassault, Sarkozy is expected to make the biggest gains in bilateral trade during his visit.

SPACE TECHNOLOGY

No commercial deals are expected, but Sarkozy’s visit is aimed at highlighting the importance of the Megha-Tropiques Mission, the joint French-Indian research effort on climate change.

A visit to Bangalore, the city popularly known as the outsourcing capital of the world, is an indication of France’s support for the Indian IT industry. Bangalore did not feature on Obama’s itinerary during his November visit. But unlike the US, France does not consider outsourcing a politically sensitive issue.

Date created : 2010-12-04

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