“These are going to be difficult times for Europe,” tweeted the Vice President of the European Parliament, Katarina Barley (SPD), in response to the election victory of the right-wing parties in Italy. The result had been expected and feared at the same time. Leading politicians are now warning about the EU’s ability to act. Three issues, in particular, worry Brussels and other capitals in the EU: Italy’s future Russia policy, the rule of law and public finances. Eric Bonse, Isabel Cuesta and Markus Grabitz capture the reactions in Europe.
In Rome, Andrea De Petris of the Centro Politiche Europee (CEP) ventures an outlook on a future Italian government under Giorgia Meloni. If the head of the Fratelli d’Italia decided to follow in the footsteps of Hungary and Poland, this would be an extremely delicate undertaking, as De Petris writes in today’s Opinion. She would then risk being treated by the EU institutions in the same way as Budapest and Warsaw. Within her coalition, she will have to find a way to set her own priorities while at the same time involving Salvini and Berlusconi.
Globalization was yesterday – in an increasingly harsh international environment, the EU will be taking a different approach in the future. In his fall outlook on trade policy, Till Hoppe analyzes projects such as the anti-coercion instrument, which the EU intends to use in the future to defend itself when other countries put individual countries under economic pressure. He also provides an overview of new trade agreements, for example with New Zealand, the Mercosur states and India.
Following the shift to the right in Italy, leading politicians warn of consequences for the EU’s ability to act. “These are going to be difficult times for Europe,” tweeted Katarina Barley (SPD), vice president of the European Parliament. Nicola Beer, EP vice president from the FDP, speaks of a “difficult moment for Europe that we need to worry about.”
Social Democrats, Liberals and Greens criticize the head of the European People’s Party, Manfred Weber: He lacked a “clear firewall”, said Green politician Alexandra Geese. Barley speaks of “shooting support from the conservatives”.
During the election campaign, Weber had campaigned for Silvio Berlusconi’s EPP member Forza Italia. Ahead of the election, Berlusconi had entered into a coalition with the far-right parties Fratelli d’Italia led by election winner Giorgia Meloni and Matteo Salvini’s Lega. In Weber’s party, the CSU, too, the handling of the right-wing alliance is obviously causing discussion.
However, Michael Gahler, foreign policy spokesman for the EPP Group, believes that the concern is exaggerated. Berlusconi’s party stands for reliability: “I have experienced Forza Italia for many years in Parliament and especially with its leading people such as Antonio Tajani, who was Commissioner for ten years and President of Parliament for two and a half years. With him, we are following a course of the middle”.
EU skeptics, right-wing populists and nationalists, on the other hand, smell morning air. French RN leader Marine Le Pen wrote that Italian head of government-designate Giorgia Meloni had withstood “the threats of an anti-democratic and arrogant EU”. Polish Prime Minister Mateusz Morawiecki also offered congratulations.
The EU Commission, on the other hand, kept a low profile. As a matter of principle, it does not comment on national elections, said chief spokesman Eric Mamer. At the same time, he rejected accusations of guilt from Rome. Brussels had supported Italy with record sums from the Covid Recovery Fund and could not be held responsible for the shift to the right.
There are concerns in Brussels and other capitals about three issues in particular: Russia, the rule of law and finance.
Future Russia and foreign policy
Berlusconi and Salvini maintain good relations with Kremlin leader Vladimir Putin. Salvini has also questioned EU sanctions imposed over Russia’s war of aggression on Ukraine. However, Meloni is not considered Putin-friendly. In Brussels, therefore, hope prevails that she will stay the course. Caution is urged by Arturo Varvelli, head of the Rome ECFR office. “Meloni has changed her political line in recent months, for example on Russia policy. This contributes to the unpredictability of the pro-European line of the future Italian government.” On foreign policy, Meloni may well follow the lead of her predecessor in office, Mario Draghi, he said.
Rule of law and EU funds
Commission President Ursula von der Leyen has already referred to the “instruments” that the EU could use if there were problems with the new government in Rome. She alluded to the rule-of-law conditionality, which allows for the reduction of funds if the EU budget is at risk. First, however, the Commission has itself to worry about. It has proposed cutting €7.5 billion from the EU budget to Hungary. However, the procedure requires a qualified majority in the Council of Ministers. If Italy joins Hungary and Poland in opposing the proposal, things could get tight.
Unsound public finances as a threat to the eurozone
Meloni called the euro a “false currency” in 2018, saying Italy had suffered from the introduction of the single currency. She is no longer calling for an exit from the euro, but a lax fiscal policy could worry the markets. Yields on ten-year Italian government bonds already rose to 4.46 percent Monday morning – the highest level since September 2013.
Former EU Commissioner Günther Oettinger warns, “Italy is so important that a policy that does not focus on budget consolidation is dangerous for the entire eurozone“. Berlusconi had to resign as prime minister of Italy in 2011 because of unsound public finances, the CDU politician told Europe.Table. “Berlusconi and Tajani now have a second chance: They must ensure a sound budgetary policy that is compatible with the Maastricht criteria.”
Italy is so large that it cannot be absorbed by the ESM bailout fund or indirectly financed by the European Central Bank, Oettinger warned. ECB President Christine Lagarde stressed in the European Parliament yesterday that the central bank would not use its latest emergency program to buy the bonds of countries committing “policy mistakes”. The instrument to safeguard monetary policy transmission is there to support responsibly budgeting countries – others should apply for a bailout, she said.
But Nathalie Tocci of Italy’s Istituto Affari Internazionali warns that concerns should not become “self-fulfilling prophecies“. “The election in Italy need not lead to Euroskepticism, pro-Kremlin policies or a setback for the transatlantic partnership,” she wrote on Twitter.
After the election, all eyes now turn to President Sergio Mattarella. But there is little doubt that the president will entrust Meloni with forming a government: The center-right alliance has secured a solid majority with 44 percent of the vote.
However, it will take another month or so before the new government is in place. A time dictated by institutional formalities. Parliament will have to meet on October 13 and elect the presidents of the chambers on that day or the following. Once the groups are formed, consultations can begin, which are expected to start around October 20.
Within the center-right coalition, the forces are unbalanced. While Meloni was able to increase her party’s result sixfold compared to four years ago, receiving 26 percent of the vote, her coalition partner Matteo Salvini was punished the most by voters – the Lega Nord came in at a meager 8.9 percent. Still, Salvini could insist on having a say in the formation of the Council of Ministers and claim the Interior Ministry for himself. This could start the problems of forming a solid government.
Silvio Berlusconi’s party, Forza Italia, also did not achieve a good result with just under 8 percent. Enrico Letta’s Democratic Party (PD) will probably have to go into opposition. Although it became the second-largest force in the country with 19 percent of the vote, it was punished for its strategy: Letta is resigning as leader of the Social Democrats after being criticized for not forming an alliance with Giuseppe Conte’s 5-Star Movement. With Isabel Cuesta and Markus Grabitz
The EU has significantly upgraded its trade policy in recent years. Brand new in its arsenal: an instrument against competition-distorting subsidies, aimed primarily at Chinese state-owned enterprises; and the International Procurement Instrument (IPI), with the help of which the EU wants to open up public tenders in other countries to European companies. Both regulations were adopted by the European Parliament and member states before the summer break.
Two legislative proposals from the EU Commission are still open: the anti-coercion instrument, which is intended to protect member states against coercive trade policy measures by other governments, and the import ban on products from forced labor, which has just been presented. At the beginning of December, Vice President Valdis Dombrovskis is also expected to present a reform of the customs system. We already informed you about the status of the planned EU supply chain law and the raw materials package in our outlook on the sustainability agenda.
In parallel, the Commission is negotiating a number of free trade agreements with third countries, with varying degrees of maturity. Russia’s attack on Ukraine has raised awareness of politically dangerous dependencies and thus brought new tailwind to trade policy, as Director General for Trade Sabine Weyand noted. The EU wants to position itself more broadly and, in particular, strengthen relations with politically close states.
But one after the other:
With the new instrument, the EU wants to be better able to defend itself when third countries put individual countries under economic pressure. A prime example is China’s action against Lithuania when Beijing imposed a de facto trade embargo on the Baltic country after Taiwan was allowed to open a diplomatic representation in Vilnius.
In such cases, the EU should be able to respond as a whole in the future, for example by imposing import restrictions or excluding them from public tenders. According to its proposal last December, the EU Commission would be given a strong position: It could initiate an investigation itself, and countermeasures would be decided in comitology proceedings.
In the European Parliament, rapporteur Bernd Lange (SPD) has just put together a compromise package based on the amendments. It provides, for example, that threatened coercive measures can already trigger countermeasures and sets deadlines for the procedures. On October 10, the Trade Committee is to vote on the report, and the following week the plenum is to confirm the parliamentary position, presumably without a new vote.
The member states are still negotiating in the Council. The main topic of discussion there is the procedure for deciding on countermeasures. Germany and other countries are pushing for a stronger say in the matter, according to EU sources. In concrete terms, the issue is what majority the Commission needs in the Council to be able to order countermeasures. However, an agreement is not too far off. The trilogue negotiations are therefore likely to begin under the Czech Council presidency.
Actors: Bernd Lange, Reinhard Bütikofer (Shadow Rapporteur Greens), Czech Presidency, Valdis Dombrovskis
Dombrovskis had presented the legislative proposal in mid-September – exactly one year after Ursula von der Leyen had announced it in her position on the EU 2021 speech. According to the proposal, products manufactured with forced labor are to be banned from the internal market. A provable suspicion is sufficient to remove a product from the domestic market and to ban its import and export. According to the proposal, the national customs or market surveillance authorities are responsible for this (Europe.Table reported).
The legislative proposal is based on two legal bases: Article 114 (Internal Market) and Article 207 (Commercial Policy) of the Treaty on the Functioning of the EU. Accordingly, there is likely to be a split competence in the European Parliament: The Internal Market Committee (IMCO) is likely to be given the lead for the parts concerning placing on the market in the common market, and the Trade Committee (INTA) for the measures at the external border. However, nothing has been clarified yet.
Actors: Valdis Dombrovskis, other actors still unclear…
In her State of the EU address, von der Leyen announced her intention to submit the agreements with Chile, Mexico and New Zealand to the Council and the European Parliament for ratification in the coming months. With other partners such as Australia and India, she said, the Commission wants to press ahead with negotiations. Director General Weyand also hopes to gain new momentum in the negotiations with the Mercosur countries.
Chile: The EU initially postponed the largely negotiated update of the 2002 association agreement at France’s insistence at the end of last year. The elections there are now over. Most recently, however, the failed constitutional referendum in Chile caused political turbulence in the Latin American country and thus new uncertainties. Chile is interesting as a trading partner because it is politically close to the EU and is needed as a supplier of lithium and copper, which are necessary for the restructuring of the local economy.
Mexico: The two sides agreed in principle some time ago to modernize the 2000 Association Agreement, eliminating almost all tariffs on goods. The Commission is currently working on separating the trade part of the agreement from the political agreements in order to speed up ratification. However, there are concerns about this in the Mexican government.
New Zealand: The EU Commission and the government in Wellington announced at the end of June that they had agreed in principle on a free trade agreement. The negotiated agreement must now be legally fine-tuned and translated into the official EU languages. It will then be submitted to the Council and the European Parliament for signature and ratification. Not too much resistance is to be expected, not least because of the ambitious sustainability chapter.
Australia: Negotiations with neighboring Australia are becoming more difficult – many sensitive points are still unresolved, Brussels says. The Commission hopes to reach a political agreement with Canberra by spring 2023. The new social democratic government there will make many things easier, says Bernd Lange: “It accepts that trade policy must also serve to reduce CO2 emissions.”
Mercosur: Much depends on the outcome of the presidential elections in Brazil on October 2: Bernd Lange and other EU trade policymakers are hoping for new momentum for the agreement, which was politically agreed in 2019, should former President Luiz Inácio Lula da Silva win against incumbent Jair Bolsonaro. The latter’s lack of interest in protecting the rainforest makes him hard to get along with in this country.
With Lula, the Europeans hope, remaining questions could be cleared up in a supplementary declaration that, in the view of critics, leaves the trade agreement open when it comes to enforcing commitments to protect the Amazon region. However, the left-leaning candidate has already expressed a need for renegotiations to strengthen Brazil as an industrial location. The EU Commission rejects this outright because it sees it as a gateway for further demands.
India: Von der Leyen hopes to conclude an agreement before the end of her term in mid-2024. But that is ambitious: Delhi still seems reluctant to open its market to Europeans. The first round of negotiations at the end of June brought little movement, according to EU circles. The question now is how far the Commission and member states want to go toward Prime Minister Modi in order to get him on their side in the conflict with Russia and the tensions with China.
“These are going to be difficult times for Europe,” tweeted the Vice President of the European Parliament, Katarina Barley (SPD), in response to the election victory of the right-wing parties in Italy. The result had been expected and feared at the same time. Leading politicians are now warning about the EU’s ability to act. Three issues, in particular, worry Brussels and other capitals in the EU: Italy’s future Russia policy, the rule of law and public finances. Eric Bonse, Isabel Cuesta and Markus Grabitz capture the reactions in Europe.
In Rome, Andrea De Petris of the Centro Politiche Europee (CEP) ventures an outlook on a future Italian government under Giorgia Meloni. If the head of the Fratelli d’Italia decided to follow in the footsteps of Hungary and Poland, this would be an extremely delicate undertaking, as De Petris writes in today’s Opinion. She would then risk being treated by the EU institutions in the same way as Budapest and Warsaw. Within her coalition, she will have to find a way to set her own priorities while at the same time involving Salvini and Berlusconi.
Globalization was yesterday – in an increasingly harsh international environment, the EU will be taking a different approach in the future. In his fall outlook on trade policy, Till Hoppe analyzes projects such as the anti-coercion instrument, which the EU intends to use in the future to defend itself when other countries put individual countries under economic pressure. He also provides an overview of new trade agreements, for example with New Zealand, the Mercosur states and India.
Following the shift to the right in Italy, leading politicians warn of consequences for the EU’s ability to act. “These are going to be difficult times for Europe,” tweeted Katarina Barley (SPD), vice president of the European Parliament. Nicola Beer, EP vice president from the FDP, speaks of a “difficult moment for Europe that we need to worry about.”
Social Democrats, Liberals and Greens criticize the head of the European People’s Party, Manfred Weber: He lacked a “clear firewall”, said Green politician Alexandra Geese. Barley speaks of “shooting support from the conservatives”.
During the election campaign, Weber had campaigned for Silvio Berlusconi’s EPP member Forza Italia. Ahead of the election, Berlusconi had entered into a coalition with the far-right parties Fratelli d’Italia led by election winner Giorgia Meloni and Matteo Salvini’s Lega. In Weber’s party, the CSU, too, the handling of the right-wing alliance is obviously causing discussion.
However, Michael Gahler, foreign policy spokesman for the EPP Group, believes that the concern is exaggerated. Berlusconi’s party stands for reliability: “I have experienced Forza Italia for many years in Parliament and especially with its leading people such as Antonio Tajani, who was Commissioner for ten years and President of Parliament for two and a half years. With him, we are following a course of the middle”.
EU skeptics, right-wing populists and nationalists, on the other hand, smell morning air. French RN leader Marine Le Pen wrote that Italian head of government-designate Giorgia Meloni had withstood “the threats of an anti-democratic and arrogant EU”. Polish Prime Minister Mateusz Morawiecki also offered congratulations.
The EU Commission, on the other hand, kept a low profile. As a matter of principle, it does not comment on national elections, said chief spokesman Eric Mamer. At the same time, he rejected accusations of guilt from Rome. Brussels had supported Italy with record sums from the Covid Recovery Fund and could not be held responsible for the shift to the right.
There are concerns in Brussels and other capitals about three issues in particular: Russia, the rule of law and finance.
Future Russia and foreign policy
Berlusconi and Salvini maintain good relations with Kremlin leader Vladimir Putin. Salvini has also questioned EU sanctions imposed over Russia’s war of aggression on Ukraine. However, Meloni is not considered Putin-friendly. In Brussels, therefore, hope prevails that she will stay the course. Caution is urged by Arturo Varvelli, head of the Rome ECFR office. “Meloni has changed her political line in recent months, for example on Russia policy. This contributes to the unpredictability of the pro-European line of the future Italian government.” On foreign policy, Meloni may well follow the lead of her predecessor in office, Mario Draghi, he said.
Rule of law and EU funds
Commission President Ursula von der Leyen has already referred to the “instruments” that the EU could use if there were problems with the new government in Rome. She alluded to the rule-of-law conditionality, which allows for the reduction of funds if the EU budget is at risk. First, however, the Commission has itself to worry about. It has proposed cutting €7.5 billion from the EU budget to Hungary. However, the procedure requires a qualified majority in the Council of Ministers. If Italy joins Hungary and Poland in opposing the proposal, things could get tight.
Unsound public finances as a threat to the eurozone
Meloni called the euro a “false currency” in 2018, saying Italy had suffered from the introduction of the single currency. She is no longer calling for an exit from the euro, but a lax fiscal policy could worry the markets. Yields on ten-year Italian government bonds already rose to 4.46 percent Monday morning – the highest level since September 2013.
Former EU Commissioner Günther Oettinger warns, “Italy is so important that a policy that does not focus on budget consolidation is dangerous for the entire eurozone“. Berlusconi had to resign as prime minister of Italy in 2011 because of unsound public finances, the CDU politician told Europe.Table. “Berlusconi and Tajani now have a second chance: They must ensure a sound budgetary policy that is compatible with the Maastricht criteria.”
Italy is so large that it cannot be absorbed by the ESM bailout fund or indirectly financed by the European Central Bank, Oettinger warned. ECB President Christine Lagarde stressed in the European Parliament yesterday that the central bank would not use its latest emergency program to buy the bonds of countries committing “policy mistakes”. The instrument to safeguard monetary policy transmission is there to support responsibly budgeting countries – others should apply for a bailout, she said.
But Nathalie Tocci of Italy’s Istituto Affari Internazionali warns that concerns should not become “self-fulfilling prophecies“. “The election in Italy need not lead to Euroskepticism, pro-Kremlin policies or a setback for the transatlantic partnership,” she wrote on Twitter.
After the election, all eyes now turn to President Sergio Mattarella. But there is little doubt that the president will entrust Meloni with forming a government: The center-right alliance has secured a solid majority with 44 percent of the vote.
However, it will take another month or so before the new government is in place. A time dictated by institutional formalities. Parliament will have to meet on October 13 and elect the presidents of the chambers on that day or the following. Once the groups are formed, consultations can begin, which are expected to start around October 20.
Within the center-right coalition, the forces are unbalanced. While Meloni was able to increase her party’s result sixfold compared to four years ago, receiving 26 percent of the vote, her coalition partner Matteo Salvini was punished the most by voters – the Lega Nord came in at a meager 8.9 percent. Still, Salvini could insist on having a say in the formation of the Council of Ministers and claim the Interior Ministry for himself. This could start the problems of forming a solid government.
Silvio Berlusconi’s party, Forza Italia, also did not achieve a good result with just under 8 percent. Enrico Letta’s Democratic Party (PD) will probably have to go into opposition. Although it became the second-largest force in the country with 19 percent of the vote, it was punished for its strategy: Letta is resigning as leader of the Social Democrats after being criticized for not forming an alliance with Giuseppe Conte’s 5-Star Movement. With Isabel Cuesta and Markus Grabitz
The EU has significantly upgraded its trade policy in recent years. Brand new in its arsenal: an instrument against competition-distorting subsidies, aimed primarily at Chinese state-owned enterprises; and the International Procurement Instrument (IPI), with the help of which the EU wants to open up public tenders in other countries to European companies. Both regulations were adopted by the European Parliament and member states before the summer break.
Two legislative proposals from the EU Commission are still open: the anti-coercion instrument, which is intended to protect member states against coercive trade policy measures by other governments, and the import ban on products from forced labor, which has just been presented. At the beginning of December, Vice President Valdis Dombrovskis is also expected to present a reform of the customs system. We already informed you about the status of the planned EU supply chain law and the raw materials package in our outlook on the sustainability agenda.
In parallel, the Commission is negotiating a number of free trade agreements with third countries, with varying degrees of maturity. Russia’s attack on Ukraine has raised awareness of politically dangerous dependencies and thus brought new tailwind to trade policy, as Director General for Trade Sabine Weyand noted. The EU wants to position itself more broadly and, in particular, strengthen relations with politically close states.
But one after the other:
With the new instrument, the EU wants to be better able to defend itself when third countries put individual countries under economic pressure. A prime example is China’s action against Lithuania when Beijing imposed a de facto trade embargo on the Baltic country after Taiwan was allowed to open a diplomatic representation in Vilnius.
In such cases, the EU should be able to respond as a whole in the future, for example by imposing import restrictions or excluding them from public tenders. According to its proposal last December, the EU Commission would be given a strong position: It could initiate an investigation itself, and countermeasures would be decided in comitology proceedings.
In the European Parliament, rapporteur Bernd Lange (SPD) has just put together a compromise package based on the amendments. It provides, for example, that threatened coercive measures can already trigger countermeasures and sets deadlines for the procedures. On October 10, the Trade Committee is to vote on the report, and the following week the plenum is to confirm the parliamentary position, presumably without a new vote.
The member states are still negotiating in the Council. The main topic of discussion there is the procedure for deciding on countermeasures. Germany and other countries are pushing for a stronger say in the matter, according to EU sources. In concrete terms, the issue is what majority the Commission needs in the Council to be able to order countermeasures. However, an agreement is not too far off. The trilogue negotiations are therefore likely to begin under the Czech Council presidency.
Actors: Bernd Lange, Reinhard Bütikofer (Shadow Rapporteur Greens), Czech Presidency, Valdis Dombrovskis
Dombrovskis had presented the legislative proposal in mid-September – exactly one year after Ursula von der Leyen had announced it in her position on the EU 2021 speech. According to the proposal, products manufactured with forced labor are to be banned from the internal market. A provable suspicion is sufficient to remove a product from the domestic market and to ban its import and export. According to the proposal, the national customs or market surveillance authorities are responsible for this (Europe.Table reported).
The legislative proposal is based on two legal bases: Article 114 (Internal Market) and Article 207 (Commercial Policy) of the Treaty on the Functioning of the EU. Accordingly, there is likely to be a split competence in the European Parliament: The Internal Market Committee (IMCO) is likely to be given the lead for the parts concerning placing on the market in the common market, and the Trade Committee (INTA) for the measures at the external border. However, nothing has been clarified yet.
Actors: Valdis Dombrovskis, other actors still unclear…
In her State of the EU address, von der Leyen announced her intention to submit the agreements with Chile, Mexico and New Zealand to the Council and the European Parliament for ratification in the coming months. With other partners such as Australia and India, she said, the Commission wants to press ahead with negotiations. Director General Weyand also hopes to gain new momentum in the negotiations with the Mercosur countries.
Chile: The EU initially postponed the largely negotiated update of the 2002 association agreement at France’s insistence at the end of last year. The elections there are now over. Most recently, however, the failed constitutional referendum in Chile caused political turbulence in the Latin American country and thus new uncertainties. Chile is interesting as a trading partner because it is politically close to the EU and is needed as a supplier of lithium and copper, which are necessary for the restructuring of the local economy.
Mexico: The two sides agreed in principle some time ago to modernize the 2000 Association Agreement, eliminating almost all tariffs on goods. The Commission is currently working on separating the trade part of the agreement from the political agreements in order to speed up ratification. However, there are concerns about this in the Mexican government.
New Zealand: The EU Commission and the government in Wellington announced at the end of June that they had agreed in principle on a free trade agreement. The negotiated agreement must now be legally fine-tuned and translated into the official EU languages. It will then be submitted to the Council and the European Parliament for signature and ratification. Not too much resistance is to be expected, not least because of the ambitious sustainability chapter.
Australia: Negotiations with neighboring Australia are becoming more difficult – many sensitive points are still unresolved, Brussels says. The Commission hopes to reach a political agreement with Canberra by spring 2023. The new social democratic government there will make many things easier, says Bernd Lange: “It accepts that trade policy must also serve to reduce CO2 emissions.”
Mercosur: Much depends on the outcome of the presidential elections in Brazil on October 2: Bernd Lange and other EU trade policymakers are hoping for new momentum for the agreement, which was politically agreed in 2019, should former President Luiz Inácio Lula da Silva win against incumbent Jair Bolsonaro. The latter’s lack of interest in protecting the rainforest makes him hard to get along with in this country.
With Lula, the Europeans hope, remaining questions could be cleared up in a supplementary declaration that, in the view of critics, leaves the trade agreement open when it comes to enforcing commitments to protect the Amazon region. However, the left-leaning candidate has already expressed a need for renegotiations to strengthen Brazil as an industrial location. The EU Commission rejects this outright because it sees it as a gateway for further demands.
India: Von der Leyen hopes to conclude an agreement before the end of her term in mid-2024. But that is ambitious: Delhi still seems reluctant to open its market to Europeans. The first round of negotiations at the end of June brought little movement, according to EU circles. The question now is how far the Commission and member states want to go toward Prime Minister Modi in order to get him on their side in the conflict with Russia and the tensions with China.
