India and Croatia Pivot to AI and Green Tech Amid EU Trade Push

The meeting between Prime Minister Narendra Modi and Croatian Prime Minister Andrej Plenković at the AI Impact Summit 2026 marks a significant recalibration of India’s diplomatic strategy within the European Union. By engaging deeply with Croatia, a nation that joined the Eurozone and Schengen Area in 2023, India is signaling its intent to build a broader coalition of support for the long-stalled India-EU Free Trade Agreement (FTA). This bilateral engagement focuses on high-growth sectors—Artificial Intelligence and Clean Energy—that are central to both nations' economic modernization agendas.

Artificial Intelligence served as the cornerstone of the discussions, reflecting a shared interest in establishing ethical frameworks and robust digital infrastructure. India, positioning itself as a global hub for AI talent and cost-effective development, seeks to align its 'AI for All' initiative with European standards of data privacy and governance. For Croatia, which has been fostering a growing tech ecosystem in Zagreb, collaboration with Indian IT giants offers a pathway to scaling its domestic digital economy. The leaders discussed joint research initiatives and the potential for cross-border sandboxes where AI startups from both nations can test applications in healthcare and agriculture.

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The meeting between Prime Minister Narendra Modi and Croatian Prime Minister Andrej Plenković at the AI Impact Summit 2026 marks a significant recalibration of India’s diplomatic strategy within the European Union.

In the realm of clean energy, the dialogue underscored a mutual commitment to the green transition. India’s leadership in the International Solar Alliance (ISA) and its ambitious Green Hydrogen Mission provide a framework for partnership with Croatia, which has significant potential in wind and geothermal energy. The discussion likely touched upon the diversification of energy supply chains, a critical priority for the EU as it moves away from traditional fossil fuel dependencies. By aligning on green technology, both nations aim to attract institutional investment into sustainable infrastructure projects, leveraging EU-wide funding mechanisms and Indian manufacturing capacity.

However, the most significant market implication remains the progress of the India-EU FTA. Negotiations, which were formally restarted in 2022, have faced hurdles regarding digital trade, sustainability chapters, and market access for dairy and automobiles. Croatia’s vocal support is vital because EU trade deals require a high degree of consensus among member states. By securing the backing of smaller, influential EU members like Croatia, India is building the necessary momentum to overcome the protectionist tendencies of larger member states. Analysts suggest that a breakthrough in the FTA could increase bilateral trade between India and the EU by over 30% within the first five years of implementation.

Looking ahead, investors should monitor the follow-up ministerial meetings scheduled for later this year. The focus will likely shift from high-level diplomatic alignment to technical working groups tasked with harmonizing standards in AI and energy. As India continues to position itself as a 'Vishwa Mitra' (Global Friend), its ability to bridge the gap between its own developmental needs and the EU’s regulatory environment will determine the success of this strategic partnership. The engagement with Croatia is a clear indicator that India is no longer just looking at the 'Big Three' of Europe—Germany, France, and Italy—but is actively cultivating a multi-layered European strategy.