Germany’s Deals With India: A Major Arms Sale?


The Indo-German trade and military agreements will probably be beneficial to both countries but India should take care with defence purchases from Germany, writes Future Directions International’s LINDSAY HUGHES



German Chancellor Angela Merkel began her much-anticipated visit to India on 4 October, a day after initiating celebrations of the twenty-fifth anniversary of German re-unification.

She was accompanied by senior cabinet members and a large trade delegation. Merkel met Indian Prime Minister Narendra Modi, who described the two countries as ‘natural partners’, for bilateral discussions on clean energy, climate change, culture, education, food security, infrastructure development and the exchange of information on terrorism.

The German Minister for Foreign Affairs, Frank-Walter Steinmeier, was also scheduled to meet India’s National Security Advisor, Ajit Doval, for further discussions.

India Germany.Indian Link
Chancellor of Germany Angela Merkel greeted by Indian Prime Minister Narendra Modi


Any German-Indian tie-up in the civil technology area can be a benefit to both countries.

Germany’s expertise in manufacturing, in the generation of electricity from renewable sources and in research and development are acknowledged in India.

Germany is, in fact, India’s sixth-largest trading partner and its largest trading partner in the European Union.

It is hardly surprising, then, that in order to attract German investment, Modi announced a fast-track mechanism to improve the ease of doing business in India. The only other country accorded this privilege is Japan.

In the event, after three hours of discussions, the two leaders agreed to expand their ties in areas as diverse as clean energy, defence, intelligence, investment, railway technology, security and trade.

Germany being a world leader in clean energy generation, Merkel announced a soft loan to India of one billion euros, in addition to the €1.15 billion that Germany had pledged earlier for that purpose.

As the third-largest emitter of carbon and facing pressure from governments and non-governmental organisations across the globe ahead of the forthcoming climate talks in Paris, this will be a welcome relief to Modi.

He has already announced plans to significantly reduce India’s carbon emissions by investing in clean energy sources and the loan will help greatly in implementing those plans.

While Merkel complimented Modi on the breadth and speed of his reforms, Modi remarked that, ‘In a world of challenges and opportunities, India and Germany can be strong partners. German strengths and India’s priorities are aligned.’

This is true. India can benefit greatly from Germany’s industrial experience and expertise.

Also, given New Delhi’s inability to mass produce quality arms and armaments, Germany, until recently displaced by China as the world’s third-largest exporter of military equipment, would present a major source of expertise in manufacturing military materiel. India could learn a lot, in short, from Germany in manufacturing techniques.

India Germany.Indian Link

Relying upon Germany to provide it with military technology, however, must be viewed with caution.

Germany has previously supplied military technology to India. Indeed, several German defence firms have established branches or partnerships in India.

EADS, which is a major partner in the development and manufacture of the Eurofighter, has a research and development centre in Bangalore (now renamed Bengaluru) and branches elsewhere in India.

Atlas Elektronik, which is involved with naval warfare systems, Krauss-Maffei Wegmann, which manufactures the highly-regarded Leopard II battle tank, and Diehl Defence, which manufactures missile systems, also have branches in the country.

Probably of most interest from India’s perspective, however, is ThyssenKrupp Marine Systems (TKMS), which manufactures the Type 214 conventional submarine. While the organisation does not have a production facility in India, it has worked with local manufacturers and shipyards.

In 2010, for instance, the company signed an agreement for its Kockums subsidiary in Sweden to deliver superstructures for Indian corvettes. TKMS is said to be willing to build submarines in India in conjunction with a local partner.

Messerschmitt-Boelkow-Blohm, which is now part of EADS, assisted India in building its Light Combat Aircraft (LCA) and Advanced Light (Dhruv) Helicopter.

Despite these connections, however, India must approach the possibility of acquiring German military equipment with a degree of caution. In simple terms, German law forbids it to export arms to countries that are at war. (See for an elaboration of this topic.)

Additionally, Germany hesitated to comply with India’s technology-transfer requirements for the LCA and Dhruv helicopter and withheld replacement parts and supplies for German equipment when India and Pakistan fought in Kargil in 1999.

It must be asked, what would Germany do if after entering into an agreement to construct of submarines in India, say, India was forced to enter into a conflict over territory or to safeguard against incursions by foreign fighters? Would Germany cease to provide the technology it previously did? For how long would it stop its supplies? Under what conditions would it re-start those?

In comparison, France, for instance, has no equivalent regulation so may be relied upon to a slightly greater extent to continue to provide agreed-upon materiel.

It would be difficult to deny the quality of German arms or the country’s ability to supply those efficiently under normal circumstances; it is the extraordinary circumstances that must provide pause for thought.

Modi must negate these shortcomings before entering into an agreement to purchase armaments from Germany.


Lindsay Hughes is a Research Analyst at the Indian Ocean Research Programme