The return of geopolitics to Europe

EU politics is becoming increasingly polarised with a strong resurgence in right-wing sentiment. A Brookings India roundtable explored why.

Contrary to its pacifist image in the immediate post-Cold War era, Europe has been the centre of attention in world geopolitics in the recent years, with first the Eurozone crisis followed by the migrant crisis. The last one year has been particularly rocky for Europe with more than a million Afghans, Arabs and Africans seeking refuge within its borders. The migrant crisis has divided the European Union, reshaped national politics and raised new security concerns while struggling to integrate large minority populations. The migrant crisis has also imposed significant economic costs on already strained European economies. EU politics is becoming increasingly polarised with a strong resurgence in right-wing sentiment, largely in response to crises like the Eurozone crisis and the migration crisis. With increasing polarisation and illiberal policies on the uptick within the EU, the future of the European integration project has been called into question. In turn, this is likely to have economic implications for the world and in particular emerging economies like India and China.

The European Union was originally envisaged as an economic community in the immediate post-World War II era to ensure the economic recovery of Europe. It was only in the post- Cold War era that the EU transformed into a politico-economic union. Over the decades, the political agenda of the EU has increased greatly. The EU is an ambitious construct that has made significant progress since its inception. Countries on opposite sides of the spectrum during the great wars in European history, have successfully collaborated on establishing a community with shared interests and values. However, geopolitics will always play a role as long as the world order follows the Westphalian system. Countries, however tightly woven in supra-national communities, will continue to think in terms of individual interests, geography, climate, population, race etc. Therefore the big challenge for the EU is to contain the erosion of the integration project and evolve according to changing circumstances.

There are several issues within the European Union that hamper its public image within the world order. In terms of security, EU nations barely spend on defence, with their defence budgets accounting for about 1 per cent of their GDP, a number that is significantly higher for other developed countries. In realist terms, this pacifist posturing makes it hard for countries to accept the sincerity and power of the EU community. With the EU being made up of economically, politically and culturally diverse nations, there is dissonance within the community on pressing geopolitical issues.  This has made it difficult for the EU leadership to take strong political decisions. EU countries are also highly uneven in their development levels and income distribution, making it difficult to establish a common course of action. It therefore appears that the political decision-making is costing the EU economically. Despite the advantages of large, educated populations and good per capita income levels, the EU appears to be struggling in coming to terms with the changing geo-political environment. The EU has been in a crisis management mode for the last several years. The EU leadership seems to be aware of what needs to be done but it is questionable whether the EU nations can muster the political capital to take some harsh steps.

The participants at the discussion agreed that the European Union will continue to be the technology hub for innovation and manufacturing and that business might not be severely affected despite the political upheaval. However, this economic role of EU could be threatened if the EU were to close its borders in response to the rising right-wing sentiment, resulting in hurdles in flow of capital, labour etc. In terms of trade, there also needs to be clarity on who is the preferable trading partner- the EU as a community or individual countries. This lack of clarity has often hampered EU relations with India. Therefore, on the question of how other economies should engage with the EU, there was a consensus that emerging economies like India should follow the Chinese model. Since EU is made up of diverse countries, China follows a model of partnering with select individual countries within EU according to China’s strategic and economic interests. India would also benefit from developing bilateral relationships with key countries in Europe while maintaining multilateral relationships with the others. The future of the India-EU relationship presumably rests on trade and economics and not politics.

Like other products of the Brookings Institution India Center, this is intended to contribute to discussion and stimulate debate on important issues. Brookings India does not have any institutional views.