‘Europe leaning towards India, now that Russia has proved to be unreliable’

Decoupled from Russia, since its conflict with Ukraine, Europe is looking for new economic partners and India will play a pretty important role in the changed dynamics, Jean Claude Trichet, former governor of Banque de France, who’d also served as the president of European Central Bank told DH’s Lavpreet Kaur on the sidelines of Dubai Business Forum in United Arab Emirates.

The prolonged Ukraine conflict – what has been its impact on Europe’s financial services as well as economic growth?

The Ukraine conflict problem between Russia and Ukraine was so unexpected and upset all the European countries dramatically. It created changes in the overall perception of many European economies. Nobody was expecting war so long after the Second World War.

So I would say that at this stage, it remains extremely uncertain what the consequences would be. But economic and financial consequences are very much associated with the increase in the price of oil and gas and the absolute necessity for the Europeans not to depend on Russian oil, gas and also food, as they did in the past. We were very dependent on them. But all that taken into account, Europe must now take advantage of the trade relationship with India and the rest of the world to cope with the situation.

How’s the economic dynamics changed for Europe since the conflict?

I think that all advanced economies have to adapt prominently to the changes in the world. The industry is now largely the privilege of the emerging economies. In India’s case, the services sector is absolutely fantastic as it has the benefit of a human resource exceptionally talented in mathematics, the digital sphere and the high-tech domain. I see European firms, including French ones, rely on the base that is located in India.

How is Europe trying to come out of its energy crisis?

The problem is more about how you reallocate your oil and gas, in a new universe where you cannot rely on one person. So that is something being addressed more rapidly than we thought. Investments are being skewed to source the liquefied gases from everywhere in the world and build a new harbour in Europe at the appropriate place. It also gives additional arguments for nuclear energy too. Many European economies are reflecting in that direction. We have to be sure that the diversification of energy supply is correct and as resilient as possible.

How is the European Union faring on sustainability and carbon neutrality?

I take it that Europeans are at the cutting edge of what has to be done. But we have all the responsibility. Developing countries tell us – you started it and we have to do the cleanup of the planet. It is true though, that promises made years ago have not been fulfilled yet including the transfer of over $100 billion (a commitment made in the 2009 Paris Agreement, to be fulfilled by 2020) for the public good in the developing countries. And that is a pity because it should have been honoured.

How do you think the Middle East Europe corridor helped Indo-European relations?

European industry relies on India a lot. So I see a lot of reallocation of trade, given that Russia is an unreliable partner. I see a big importance of India, especially taking into account the struggle between China and the US, which puts India in a particular spot. Additionally, India is also a democracy which is essential.

How do you perceive Europe’s business prospects, in the light of the newly expanded BRICS bloc?

Maybe too optimistic. I don’t see it as anti-G-20. The fact that India was the chair of G-20 as well as an eminent member of the BRICS.drives me to the sentiment that it is a club where a lot of countries including the UAE, can exchange views, compare notes.