The European Union signed a "strategic partnership" with India Monday aimed at tightening economic and political ties with a burgeoning economy seen in Europe as an emerging power. 

The deal strengthens European trade, investment and other economic ties with the South Asian country.

It breaks new ground by opening the door to increased cooperation in political areas, such as nonproliferation of dangerous arms, the fight against terrorism, ways to promote stability on the Asian subcontinent and United Nations reforms.

The accord was signed by Dutch Prime Minister Jan Peter Balkenende, whose country holds the EU's rotating presidency, and Indian Prime Minister Manmohan Singh.

The two sides also signed an accord -- worth US$43 million -- for European scholarships for 1,000 Indian students a year over the next three years.

The EU rivals the United States as India's leading trade partner, accounting for 23 percent of the country's exports in 2002.

Two-way trade between India and the EU nearly tripled to US$33 billion from 1992 to 2002, according to EU figures.

India's economy has long trailed behind those of its East Asian neighbors, but is expected to surge in the next 20 years. Outsourcing of European and American jobs has been a boon for India, and the country's pharmaceutical, telecommunications and auto industries are booming.

The EU plans to use the partnership agreement to develop political discussions about peace and stability, conflict prevention, the fight against terrorism, human rights as well as organized crime and migration issues.

Both India and the EU also want to reform the United Nations, including the powerful Security Council. There are now five permanent council members -- the United States, China, Russia, France and Britain -- that have the power to veto resolutions. India, like EU member Germany, seeks a permanent council seat.

On the economic front, the EU wants India to open up to European investments, which now only represent 0.2 percent of the EU's total foreign investments.

(China Daily November 9, 2004)