India – Spain Bilateral Relationship

What’s in today’s article?

• Why in the News?
• Historical Ties
• Bilateral Trade
• Strategic Significance and Cooperation
• Common Groupings and Multilateral Cooperation
• Indian Diaspora in Spain
• News Summary

Why in the News?

• Spain’s Prime Minister Pedro Sanchez is reaching Vadodara, Gujarat where he and Prime Minister Narendra Modi will hold bilateral talks and inaugurate the Final Assembly Line (FAL) plant of the C295 medium-lift tactical transport aircraft for the Indian Air Force.

Historical Ties

• India and Spain established diplomatic relations in 1956.
• Though limited historical interaction existed prior, both nations’ shared democratic values, commitment to global peace, and respect for multiculturalism have formed a strong foundation for bilateral ties.
• High-level visits, including by heads of state, have helped solidify this relationship over the years.

Bilateral Trade

• Spain is India’s 6th largest trade partner in the European Union.
• Total Trade (2023): US$ 8.25 billion, a 4.2% increase from the previous year.
• India’s Exports to Spain: US$ 6.33 billion (growth of 5.2%).
• India’s Imports from Spain: US$ 1.92 billion (growth of 1.05%).
• Top Indian Exports: Mineral fuels, chemical products, iron and steel, electrical machinery, apparel, nuclear reactors, marine products, and articles of iron and steel.
• Foreign Direct Investment:
  • Spanish FDI in India:
    • US$ 3.94 billion (April 2000 - December 2023), with Spain as India’s 16th largest investor.
    • Over 280 Spanish companies in India, focusing on metallurgical industries, renewable energy, automotive, ceramics, and infrastructure.
    • Major destinations: Maharashtra, Tamil Nadu, Gujarat, Andhra Pradesh, Karnataka.
  • Indian FDI in Spain:
    • ~US$ 900 million; 80 Indian companies in Spain, primarily in software & IT services, pharmaceuticals, chemicals, and logistics.
    • India is among Spain’s top 30 investors globally and top 5 from Asia.
• Trade and Economic Cooperation Framework:
  • India-Spain Joint Commission on Economic Cooperation (JCEC): Established in 1972; has met 12 times, with the latest meeting in April 2023 in New Delhi.
  • India-Spain CEOs Forum: Established in 2015; first formal meeting held in May 2017 in Madrid.

Strategic Significance and Cooperation

• The strategic relationship between India and Spain is steadily expanding, encompassing areas like defense, counter-terrorism, and cybersecurity:
• Defense:
  • Spain is a key partner in India’s defense modernization, providing expertise in aerospace and naval technology.
  • Spanish companies are involved in defense projects, including submarine technology transfer and collaborations for military aircraft.
• Counter-Terrorism:
  • India and Spain actively cooperate in counter-terrorism and intelligence sharing, recognizing mutual concerns regarding global terrorism.
• Sustainable Development and Climate Action:
  • Both nations are committed to the Paris Agreement and actively collaborate on climate change and sustainable development goals.
  • Spain’s expertise in renewable energy aligns with India’s goal of increasing clean energy sources.

Common Groupings and Multilateral Cooperation

• India and Spain engage collaboratively through several multilateral platforms, including:
• United Nations: Both countries work together on issues of global peace, sustainable development, and humanitarian aid.
• G20: As members of the G20, India and Spain share a commitment to addressing global economic challenges, trade reforms, and climate action.
• International Solar Alliance (ISA): Spain is a member of the ISA, aligning with India’s initiative to promote solar energy and sustainable development.

Indian Diaspora in Spain

• The Indian community in Spain is relatively small but has been growing in recent years.
• Population: As of 2023, approximately 55,000 Indians reside in Spain, contributing actively to sectors like hospitality, retail, IT, and healthcare.

News Summary

• Spain’s Prime Minister Pedro Sanchez is visiting India from October 28 to 30, marking the first visit by a Spanish PM in 18 years.
• Sanchez will hold bilateral talks with Prime Minister Narendra Modi in Vadodara, Gujarat, where they will inaugurate the Final Assembly Line (FAL) plant for the C295 tactical transport aircraft.
  • It is India's first private military transport aircraft production facility, developed by Tata Advanced System Limited (TASL) in partnership with Airbus Defence and Space.
• Under the $2.5 billion contract, 56 C295 aircraft will be supplied, with the first 16 delivered from Spain and the remaining 40 assembled in Vadodara.
• This plant is expected to produce its first "Made-in-India" C295 in 2026, with all deliveries by 2031.
• The project aims to build a complete industrial ecosystem in aerospace manufacturing in India, with contributions from Bharat Electronics Ltd, Bharat Dynamics Ltd, and private MSMEs.
• Sanchez will also visit Mumbai, engaging with industry leaders and film personalities to strengthen collaborations in trade, media, and entertainment.
• Several MoUs are expected to be signed, furthering cooperation in trade, IT, infrastructure, renewable energy, defence, pharma, and tourism.

Q1. What do you mean by Diplomacy and Foreign Policy?

Diplomacy focuses on conducting international relations through diplomatic channels, while foreign policy encompasses the broader framework of a state's strategies, goals, and approaches in its interactions with other countries.

Q2. What is the difference between Statecraft and Diplomacy?

Diplomacy (using non-lethal means to manage interstate relations and foreign threats) and statecraft (managing state power to promote national interests) are the key tools by which a nation? s foreign policy is implemented.

Source: Spanish PM Pedro Sanchez to visit India from October 27-29: MEA | EOI