India: Speech by High Representative/Vice-President Josep Borrell at the India-Europe Business and Sustainability Conclave

New Dheli
EEAS Press Team

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Ministers, colleagues, Excellencies, ladies and gentlemen,

What world do we live in today? What world do we see today? Let’s start with the obvious thing.

[The] first thing we see is a war. It is an war [of aggression] of Russia against Ukraine that has shaken the rules-based order, the world economy and our global security. 

Second, we see that everything has become a weapon. [The] weaponisation of everything. The factors that used to bring us together are now instruments of power being used against the other: investment, energy, migration.

We see that the multilateral system is in crisis. Power politics and distrust among main actors are putting pressure on the United Nations system, on the G20, on the World Trade Organisation (WTO) and beyond. Let’s hope that today, we could try to solve some things at the G20 [Foreign Ministers’] meeting.

We are facing geopolitical challenges, and India – believe me – remains an indispensable strategic partner for the European Union. You are - you have become - the fifth economy in the world, the most populated country and in not many years you will be the third economy in the world.

So, in many areas, and in particular in energy, technology and economics, you are critical for us. So let me say something about these three points.

First, about energy. We are facing a massive rise in energy prices. And the trend will continue because the world needs much more energy. We – the rich people – can decrease our consumption, but two thirds of the mankind need to consume much more. So, the solution for climate change will not come by from saving energy at the global stage because there are too many poor people that have never seen a [light bulb].

But the war pushes energy prices up and we have seen big changes – starting with us, we, the European Union. We were dependent by 40% from gas imports from Russia, and for some Member States by 100%. We have learned that the supplier can have strategic intentions and that the nature of the regime of the supplier matters. We have had to take important steps in order to free ourselves from these dependencies – and we succeeded. Germany has cut its dependency on Russian fossil fuels to zero, in a record time. 

And I think that in this geopolitical setting, [there] is an even greater potential for increasing our energy cooperation – EU-India cooperation – on solar [energy], green hydrogen, [and] offshore green energy. Intensifying outreach towards the private sector in both India and the European Union will be key.

We are determined to make the green energy transition inclusive and socially just. The transition has to be just or it will not happen. If it is not just, [there] will be so much political resistance - both at home and abroad - that it will fail. So, let’s provide cheaper, affordable, alternative ways of producing energy.

This will be mutually beneficial and a long-term partnership with India in coordination with the G7 countries.

I insist: promoting cheaper, renewable energy is more important than ever to accelerate the short-term energy transition. Renewables are growing fast but look: carbon energy is still 80% of the world’s energy supply. It is still 80%, the proportion has not decreased. Renewables grow but carbon is still 80%. A lot has to be done.

And Russia’s war against Ukraine has accelerated our energy transition, especially in Europe and the United States. The rest of the world will have to follow.

Second, technology. I am an engineer by training, and I am strongly convinced that mastering technology has always driven history and international affairs. Technology is the basis of power.

Today, we are in the middle of a technological race. Artificial intelligence will be the battlefield of the big confrontation between the United States and China. Robotics, quantum computing - all these words will shape our future, our economies, our societies.

Whoever will control these technologies will be the winner. And the best thing to do is to try to cooperate in order not to make these battlefields a real battle, a battle of influence.

Look at what is happening today. The United States is leading the technological race but there are four non-US companies which are rising and becoming maybe the masters of the technological future. 

One [is] from Taiwan (Taiwan Semiconductor Manufacturing Company Limited, TSMC). Another [one is] from the Netherlands (SML). Another [one is] from China (BYD) and another [one] from China (CATL). 

I wonder how many people around the world know the names of these companies. They know the GAFA (Google, Apple, Facebook, Amazon) but these [other companies] are quite unknown by the big public. 

They are the masters of the chips’ production and the more precise the chips are, the greater the concentration of production. Taiwan and South Korea will dominate the industry of semiconductors. They are critical for everything. We - in the European Union – import 85% of all semiconductors that we use.

We are moving to [towards] a world where access to and control of critical raw materials will be key. 

Today, we are more dependent on China for critical [raw] materials than we were dependent on Russia on fossil energy. And for the green transition, we will need lithium, cobalt, rare earth for batteries, [or] magnets for turbines. These are physically located in a very limited number of countries. Cobalt, lithium, copper [are] concentrated in Congo, Australia, Chile and China.

So, we have an interest in deepening our collaboration with India in a number of ongoing digital initiatives to deliver tangible results.

And the last words about the geopolitics of the economy. 

Dear friends and market, the global economy is being marked by a global slowdown. [I am] sorry to say but the latest figures of the World Bank show 1.7% for the global growth. That is not enough for the world. 

We have had an unprecedented level of inflation - pushed by energy and food, pushed by the war - never seen since the seventies. Indications are that the inflation is going down, but it is still very high: 9% at global level and some countries, like Turkey and Argentina, above 70%.

This is being driven by energy, transport and food prices, but it has created a push on interest rates rising fast. Never before the central banks have acted in such a determined manner, all together, tightening the monetary conditions, with the Federal Reserve of the United States in the lead.

And as always, developing countries were hit particularly - by the pandemic first, [and] by the debt now. Interest rates and debt. And there is a person responsible for that, it is the same person that started the war.

Many countries around the world will have difficulties in accessing global capital markets. There is a big risk of debt crisis. Sri Lanka has been the first. I am afraid it will not be the last. This will increase inequality. Poverty reduction is slowing.

The key problems today: debt sustainability, interest rates rising, dollar strengthening, [and] capital flowing back to advanced economies. We know this story: the dollar going up, the capitals flows going out of the emerging economies to the most advanced ones.

It makes the issue of debt relief unavoidable. No matter our own difficulties, we will have to face debt relief for a lot of countries around the world.

To sum up, we hear [from] our partners around the world that they want the European Union to engage more. I heard that at the United Nations General Assembly last week in New York.

I think that we are a good partner, faithful to international norms and to the multilateral system. But we are also reminded of our concerns by the rest of the world. 

The recovery from COVID-19 has been very unequal. This debt crisis, this inflation, this food insecurity, this climate change, this international system that many see as outdated – it is certainly outdated – paralysed and inequal, require us to be more proactive and more attentive.

I would like to remind our friends and partners that we are very busy with the war in Ukraine, but we are not forgetting about the rest of the world. We are still the biggest donour of development and humanitarian assistance and we are a reliable partner.

And this is not about solidarity. It is about our geopolitical position, because today the European Union wants to be a geopolitical power for the good of the world.

Thank you. 


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