PM Modi left New Delhi for UAE on the morning of May 15. Then he reached Italy via Netherlands, Sweden, and Norway. He will return to Delhi on the morning of the 21st after visiting 5 countries in 6 days.
What did PM Modi bring back from this marathon tour of approximately 140 hours and what does it mean for India; find out in today’s explainer…
The first stop was UAE. Modi stayed here for about 3 hours. He met President Sheikh Mohammed bin Zayed. During this, 7 MoUs were signed, the most important of which was a Strategic Petroleum Reserve Agreement.
Under this, UAE’s Abu Dhabi National Oil Company will now store 3 crore barrels of crude oil in India’s strategic oil reserves. In case of war situations or supply disruptions, India will have the first right over this reserve. UAE will also pay rent for this reserve.
Currently, India has 3 strategic oil reserves in Karnataka and Andhra Pradesh. Their capacity is 53.3 lakh metric tons, meaning approximately 4 crore barrels of oil can be stored in them. A new reserve is being built in Chandikhol, Odisha and the reserve capacity is being increased in Padur, Karnataka.
Apart from Indian reserves, arrangements will also be made for petroleum reserves for India in Fujairah, UAE.
Significance of this Deal
India imports about 90% of its crude oil needs from other countries. That’s why it maintains a reserve for a few days to deal with any emergency.India has the capacity to store strategic oil reserves equivalent to only 9 days of consumption. Even that is currently only 65% filled. Whereas Japan has 254 days, America has 200 days, and China also has 120 to 180 days of strategic oil reserves.Out of the crude oil received from UAE, 13.7 million barrels will be stored in India and the remaining 16.3 million barrels will be in the storage facility located in Fujairah, UAE. This will increase India’s strategic oil reserve to 14-15 days.Another special thing about crude oil coming from UAE is that it doesn’t have to pass through the Strait of Hormuz. UAE’s oil reaches Fujairah port on the coast of the Arabian Sea from the Habshan Oil Field through a special pipeline. From here, ships can load oil and come directly to India.
Officials from India and UAE exchanged agreements in the presence of PM Modi and UAE President Al Nahyan.
2 More Important Deals with UAE
UAE will establish a ship repairing center in Vadinar, Gujarat. Training for sailors will also be conducted here.UAE will invest 3 billion dollars, approximately 48 thousand crore rupees, in India. This investment will be in the infrastructure sector, banking and financing sector.
The second stop was Netherlands. He reached there on the night of May 15 at around 9 pm and stayed for one and a half days. He met with the Netherlands’ royal family and Prime Minister Rob Jetten. During this, 17 MoUs were signed. Of these, 2 are main ones-
1. Chip-Making Deal
Netherlands’ ASML company has partnered with Tata Electronics in chip-making. Tata Electronics is building a chip-making factory in Dholera, Gujarat.These chips are used in mobile phones and vehicles. This chip is also used in Artificial Intelligence, i.e., AI.ASML company has a monopoly in the special lithography technology used in chip manufacturing. It will help in setting up the factory and starting production in India.India currently imports 90% of chips from countries like China, Hong Kong, Taiwan, South Korea, Singapore, Japan, USA. In 2023-24, India imported chips worth 1.05 lakh crore rupees, which is 20 times more than 2016.Tata Electronics is setting up India’s first semiconductor plant at a cost of 91 thousand crore rupees. With the cooperation of the Netherlands, this chip will be manufactured in India. This will reduce dependence on foreign countries.
Representatives of Tata Electronics and Dutch company ASML signed the deal. During this, PM Modi and Netherlands Prime Minister Rob Jetten stood behind them.
2. Critical Mineral Support
Netherlands will provide India with modern technology for exploration and mining of critical minerals.India considers 30 minerals as critical. These include cobalt, copper, lithium, graphite, nickel, etc.These are used in everything from electric vehicles, smartphones, 5G networks to fighter aircraft and spacecraft.Currently, India imports 100% of critical minerals from other countries. Especially from China.Naturally, there is no shortage of these minerals. But not much has been spent on their exploration. There is a lack of processing technology. Now with the cooperation of Netherlands, this gap can be filled to some extent. Dependence on China will also reduce.
2 more deals signed with Netherlands
A 30 km long Kalpasar Dam project is underway on the Gulf of Khambhat in Gujarat. Netherlands is an expert in water engineering. It will help in the design and engineering of the Kalpasar project.Netherlands has returned copper plates from the Chola dynasty period to India. It contains a description of the dynasty in Tamil language. Dutch missionaries had taken it to Europe in the 18th century.
21 large and 3 small copper plates coming from Netherlands to India contain information about the Chola Empire’s maritime power and administrative system written in Tamil language.
Modi reached Sweden on May 17 for the third leg. He was honored with Sweden’s highest national honor ‘Royal Order of the Polar Star’. Modi met with Sweden’s Prime Minister Ulf Kristersson and signed 6 agreements for strategic partnership. This includes matters like doubling trade in the next 5 years.
A major development was certainly visible. In Sweden, European Union President Ursula von der Leyen promised Modi that by the end of the year, she would sign the Free Trade Agreement finalized between India and the EU.
When Leyen had visited India on Republic Day, this agreement was announced on January 27. Modi and Leyen had named it the ‘Mother of All Deals’.
Under this deal, tariffs on approximately 96.6% of goods coming from Europe will be completely removed or significantly reduced. Europe will do the same for 99.5% of goods coming from India.
The fourth stop was Norway, where Modi arrived on May 18. The last time was in 1983 when Indira Gandhi visited Norway. Now after 43 years, an Indian Prime Minister has visited Norway. Agreements were made on a total of 12 issues. The most important among them is a Green Strategic Partnership.
Under this, Norway will invest in India’s clean energy projects. Clean energy means energy that does not harm the environment. Such as- solar energy, wind energy, hydroelectric power, nuclear energy. About 98% of Norway’s electricity supply comes from clean energy.
India’s target is to produce 500 gigawatts of clean energy by 2030. By April 2026, only 283.46 gigawatts of capacity has been installed. That means about half of the target.
Norway is Europe’s largest oil producer, India is buying LPG
Norway is surrounded by sea on three sides. It extracts oil from the Norwegian Sea and the Barents Sea. Norway produces about 2 million barrels of crude oil every day and is Europe’s largest oil producer. It exports 90% of it. It sells most of the oil to European countries. India has also purchased oil from Norway in small consignments on several occasions. Since the start of the Iran war, India has also increased its purchase of LPG from Norway.
Norway’s largest oil company Equinor also participated during the India-Norway Business Summit. Earlier in 2024, there were reports of India buying crude oil from Equinor for its strategic reserves. India may explore options to buy oil from Norway in the future as well.
Controversy over not answering journalist’s question
In the capital Oslo, Modi and Norway’s Prime Minister Jonas Gahr Stre held a joint press briefing. When he was about to leave the conference, a female journalist asked, ‘Why don’t you answer questions from the world’s freest press?’
When the PM left without answering her, journalist Heli Ling posted this video on social media. Following this, the Ministry of External Affairs called a press conference and asked Heli to pose her questions there. Here too, there was a debate between Sibi George, Secretary for Western Affairs in the Ministry of External Affairs, and Heli.
PM Modi and Norway’s Prime Minister Jonas Gahr Stre leaving after the joint press meet in Norway.
Modi reached Italy on May 19 for the last leg of his Europe tour. Where he met Prime Minister Giorgia Meloni. In Italy, both leaders traveled in the same car and took a selfie at the 2000-year-old Colosseum. Modi also gifted Melody toffees.
Several agreements were signed between India and Italy, 2 of which are major-
1. Trade Connectivity through IMEC
Both countries have agreed to advance the India Middle East Europe Economic Corridor, i.e., IMEC. IMEC was announced on September 9, 2023, during the G20 Summit in Delhi. This project is a plan to connect India with the Middle East and Europe through railway, port, and shipping networks.
Why is IMEC important?
Italy is among Europe’s major maritime trade centers. Commerce Minister Piyush Goyal had said during the G20 that this could reduce the time and cost of delivering goods from India to Europe by 30-40%.IMEC is being developed as a response to China’s Belt and Road Project. China is creating a joint trade route in collaboration with Pakistan, America, Saudi Arabia, and European countries.India currently conducts a major portion of its trade with Europe through sea routes. After IMEC is established, Indian exports could increase rapidly.
2. AI, Technology and Cyber Security
Modi said, ‘By combining India’s Digital Public Infrastructure and Italy’s Industrial Technology, a new technology and innovation ecosystem will be created. Both countries will also work together on responsible and secure AI development.
Additionally, India and Italy have set a target to increase bilateral trade to more than 20 billion euros by 2029. Currently, the trade between India and Italy stands at 14 billion euros, which is approximately 1.60 lakh crore. Both countries have decided to elevate their relationship to the status of ‘Special Strategic Partnership’. Modi also extended an invitation to Meloni to visit India.
Research Support – Prathamesh Vyas