"EU will increasingly rely on India to counterbalance China’s rise"

The Asia Society Policy Institute’s Center for China Analysis (CCA) has published a report — “A New Triangle: The Interplay Between China and EU-India Relations” by CCA Senior Fellow Philippe Le Corre, who examines the evolving relationship between Brussels and New Delhi and explores how an EU-India partnership could take center stage as tensions with China escalate.

“Since 2019, the Sino-European relationship has encountered rising economic and strategic challenges, paving the way for a new player — India,” writes Le Corre. “Economic ties between India and Europe are growing, including in defense procurement, with both sides increasingly interested in expanding them.”

Le Corre details several factors that have driven a wedge between China and the EU, including Beijing’s coercive economic practices and frequent meetings between Xi Jinping and Vladimir Putin. Meanwhile, the EU and India share a commitment to a “rules-based global order, effective multilateralism, sustainable development, and a certain degree of strategic autonomy,” he writes.


Trade in goods between the EU and India has surged by almost 90% over the past decade, notes Le Corre. “The EU is already India’s largest trading partner, with $133.7 billion worth of trade in goods in 2023, 12.2% of India’s total trade.”

But upgrading the EU-India relationship could prove challenging, Le Corre cautions. European Commission President Ursula von der Leyen and Indian Prime Minister Narendra Modi have expressed their intention to finalize a free trade agreement by the end of 2025, but some EU members have concerns, particularly on agricultural and environmental issues.

“Despite challenges, the EU-India relationship will remain pivotal. As the global order continues to shift, the EU will increasingly rely on India to counterbalance China’s rise and address the changing dynamics in the Indo-Pacific region,” concludes Le Corre.

Twenty-five years ago, the European Union viewed China as a top priority for business, cultural exchanges, and diplomacy. Following the introduction of Beijing’s open-door policy in 1978 and with strong encouragement from Chinese authorities, European companies flocked to China. Initially, many Europeans used Hong Kong as an intermediary for business, but by the mid-1990s, Guangdong Province and Shanghai became key gateways to the Chinese market, particularly for Germany and France, according to the report.

Trade and investment surged, especially after China’s accession to the World Trade Organization (WTO) in 2001, which was widely supported by European political and business elites. Today, China remains the EU’s largest trading partner, with substantial European investments across the mainland, the report said.

In contrast, India was long viewed as a potential partner, but only a few EU member states took steps to forge a strategic partnership with New Delhi. European investments in India were — and still are — limited, with many corporations citing challenges such as inadequate infrastructure, market access barriers, and bureaucratic red tape, which make it difficult to operate in most Indian states. However, the mood has begun to shift, the report pointed out.