By AFP and Focus | 2026-01-14

AHMEDABAD, India -- India and Germany are looking to boost defense industry cooperation, Prime Minister Narendra Modi said on January 12 after hosting Chancellor Friedrich Merz in his home state of Gujarat.

Merz said Berlin also wants a closer security partnership with New Delhi, including deeper "cooperation between our defense industries" to cut India's traditional dependence on Russia for military hardware.

Germany is intensifying its strategic focus on India, the world's most populous nation, as shifting global growth patterns redefine economic priorities. A recent Organization for Economic Cooperation and Development forecast indicates that India's economy will significantly outpace China's this year, highlighting New Delhi's growing influence in international trade and investment strategy.

Both countries announced several agreements and joint declarations after the leaders' meeting with an aim to boost their $50 billion annual trade.

The announcements included cooperation on the defense industry, semiconductors and critical minerals.

The two countries "are working together on secure, trusted, and resilient supply chains and our MoUs [memoranda of understanding] on these issues will strengthen our partnership," Modi said.

The meeting between the Indian and German leaders comes at a time when both are facing economic and security challenges from the world's two biggest economies, China and the United States.

Merz said Berlin was "committed to an international order in which we can live freely and securely, because the world is currently undergoing a process of realignment."

"It is increasingly characterized by great power politics and thinking in terms of spheres of influence, which is why we must join forces to weather these rough winds," he added.

"That is why we also want to move closer together in terms of security policy, such as conducting joint exercises between our air forces and navies for security in the Indo-Pacific."

'Strategic importance'

"It is of particular strategic importance that we deepen cooperation between our defense industries. This strengthens both sides and also helps to make India less dependent on Russia, for example," said Merz.

Russia has been India's main armorer for decades.

"During the past two decades, Moscow supplied 65% of India's weapons purchases," Deutsche Welle reported in 2024.

Wary of that point of vulnerability, India has tried to cut its dependence on Russia in recent years by diversifying imports and pushing its own domestic manufacturing base.

Today it counts France, Israel and the United States as other key military suppliers.

A deal for German subs

Berlin and New Delhi have been negotiating a potential deal for Germany's Thyssenkrupp Marine Systems to build six submarines for the Indian navy in partnership with Indian state-run Mazagon Dock Shipbuilders.

While still being negotiated, that deal would allow India to replace its ageing fleet of Russian-built submarines and likely include technology transfer provisions to help its domestic defense industry.

In defense, the two sides are exploring other areas of convergence as New Delhi pumps billions of dollars to upgrade its navy and air force in the next few years.

There are about 300,000 Indians and people of Indian origin in Germany, including about 60,000 students -- many of them in critical science, engineering and other key technology research fields.

Many Indian workers have filled a recent shortfall of qualified professionals in Germany's information technology, banking and finance sectors.

"India is honored that he [Merz] has chosen our nation as the place of his first visit in Asia," said Modi.

The leaders agreed on "deeper cooperation in defense, space and other critical and emerging technologies," he said.

Merz's visit to India, his first to an Asian country since taking office last year, comes ahead of a planned India–European Union summit scheduled for late January, where leaders hope to make progress on a long-pending free trade agreement.

The appeal of India

German policymakers have reason to turn to India, given that China has mounted a decades-long military buildup, claims more than 80% of the South China Sea as its territory and has supported the Russian invasion of Ukraine.

In an era of geopolitical realignment, China's growing unpredictability has led many Germans to view a shift of business toward the world's largest democracy as a "wise move," a commentary published by Frankfurter Allgemeine Zeitung on January 13 said.

India's appeal lies in its vast labor force, "young and full of energy," a potential often overlooked but one that could, if unleashed, drive long-term growth, the commentator added.