India - Luxembourg Relations

India enjoys friendly and warm relations with Luxembourg. Relations are further strengthened through regular exchange of high-level visits between the two countries. In the recent past, important visits from India include that of Minister of Steel, Chemicals and Fertilizers, Mr. Ram Vilas Paswan, in September 2006; Minister of Overseas Indian Affairs Mr. Vayalar Ravi on 29-30 September 2009 during which an Agreement on Social Security was signed; and a high level Parliamentary Delegation led by Hon’ble Speaker of Lok Sabha Smt. Meira Kumar from June 10-13, 2010.  From Luxembourg, recent important visits include that of Minister of Budget and Treasury, Mr. Luc Frieden leading a financial mission in January 2007, Deputy Prime Minister and Foreign Minister, Mr. Jean Asselborn in February, 2007; and an Economic Mission led by the Minister of Economy and Foreign Trade, Mr. Jeannot Krecke, in April 2007 and Mr. Krecke again visited India in January (9-14) 2010 leading an economic delegation.   

Political Issues

i) United Nations:  Luxembourg has extended its support to India's permanent seat in the UNSC during the visit of President KR Narayanan in 1998.  It opposed embargoes against India in the aftermath of the nuclear tests of 1998. Luxembourg co-sponsored the G-4 resolution in 2005.

ii) Disarmament and Nuclear Energy Policy:  Luxembourg is not a member of the Conference on Disarmament, where it has an observer status.  However, it supports various disarmament initiatives and is a supporter of nuclear non-proliferation and other various disarmament initiatives such as Biological Weapons Convention, Chemical Weapons Convention, CTBT, MTCR, FMTC, Convention on Anti-Personnel Mines, etc.  It is also member of the Common EU Strategy against Proliferation of Weapons of Mass Destruction and EU code of conduct on arms exports.  It is a member of the NATO and has supported initiatives taken by other NATO members such as Belgium calling for reduction of tactical nuclear weapons in Europe and reduction in strategic nuclear weapons by the nuclear weapon states to comply with the NPT.  It is a member of the NSG and supported India-US Nuclear Agreement for peaceful purposes in 2008.

Important Bilateral Treaties and Agreements:

Economic Relations

Luxembourg companies particularly in sectors such as steel, automotive equipment and IT are exploring opportunities in India to diversify their markets.  In its efforts to strengthen relations with India, Luxembourg opened its Embassy in Delhi in 2002.  The other countries where Luxembourg has Embassies in Asia are China, Japan and Thailand.

The full range of bilateral economic relations is discussed under the framework of India-Belgium-Luxembourg Economic Union (BLEU) Economic Joint Commission, the 12th round of which took place in Brussels on 15 April 2011.

Luxembourg based investment funds hold a substantial banking and asset management market share in portfolio investments in India. More than 100 Indian companies are listed on the Luxembourg stock exchange through global depository receipts.

INDIA-LUXEMBOURG TRADE From 2004 To 2009

During the period 2004 to 2009, bilateral trade between India and Luxembourg rose from 23 million Euro in 2004 to 44 million Euro in 2009. Indian exports to Luxembourg during the same period decreased marginally from 12.2 million Euro in 2004 to 10.6 million Euro in 2009. Indian imports from Luxembourg, on the other hand, increased during the same period from 11.4 million Euro in 2004 to 34 million Euro in 2009.

MAJOR ITEMS OF INDIAN EXPORTS TO LUXEMBOURG

Major Indian exports to Luxembourg are in the sectors of Textiles and Clothing, Metal & Metal products, and Engineering items. In 2009, the sector of Textiles and clothing accounted for 66% of India’s total exports to Luxembourg. The sector of Misc manufactured items showed a higher growth rate of 193% during the period 2004 to 2009. 

MAJOR ITEMS OF INDIAN IMPORTS FROM LUXEMBOURG

Major Indian imports from Luxembourg were in the sectors of Engineering products, Metal and metal products and rubber & plastic products. In 2009, engineering products had a share of 83% in India’s total imports from Luxembourg with imports worth 28.1 million euro.

FDI FLOWS BETWEEN INDIA AND LUXEMBOURG

Foreign Direct Investment (FDI) from Luxembourg into India amounted to US $ 280. 66 million from April 2000 to April 2010 Luxembourg is the 25th largest investor in India worldwide and 10th largest within the EU. The total FDI into India from Luxembourg comprises only 0.14 percent of the total, much below the potential. Indian direct investment in joint ventures and wholly owned subsidiaries in Luxembourg was US$ 18.25 million from April 1996 to February 2006 (Source: Website of Ministry of Finance).

Indian community

There are around 400-500 Indians in Luxembourg of which 300 are PIOs and remaining 200 are Indian passport holders. There is an Indian Association which coordinates cultural and other activities of the Indian community in Luxembourg. In March 2009, an Indian Business Chamber of Luxembourg (IBCL) was constituted to promote commercial relations between India and Luxembourg. The Chamber intends to facilitate business activities and assist in the setting up of business ventures.