India and Germany Sign Deals to Deepen Economic and Security Ties

German Chancellor Friedrich Merz, left, shakes hands with Indian Prime Minister Narendra Modi following a joint statement to the media in Gandhinagar, India, Monday, Jan. 12, 2026. (AP)
German Chancellor Friedrich Merz, left, shakes hands with Indian Prime Minister Narendra Modi following a joint statement to the media in Gandhinagar, India, Monday, Jan. 12, 2026. (AP)
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India and Germany Sign Deals to Deepen Economic and Security Ties

German Chancellor Friedrich Merz, left, shakes hands with Indian Prime Minister Narendra Modi following a joint statement to the media in Gandhinagar, India, Monday, Jan. 12, 2026. (AP)
German Chancellor Friedrich Merz, left, shakes hands with Indian Prime Minister Narendra Modi following a joint statement to the media in Gandhinagar, India, Monday, Jan. 12, 2026. (AP)

Indian Prime Minister Narendra Modi and German Chancellor Friedrich Merz met on Monday in western Gujarat state to push for deeper economic and security ties between the South Asian nation and Europe’s largest economy.

Modi and Merz held talks in the city of Gandhinagar, where the two countries signed various agreements to enhance cooperation in the defense sector, skill development, health and education, as both nations seek to reduce dependence on China and bolster economic ties.

After the bilateral talks, Modi noted that Germany is India’s most important trading partner in the European Union and said both leaders were seeking to expand those ties.

He said the two countries are pursuing new projects in areas such as climate action, energy and mining of rare earth elements, and have also agreed on a road map to boost cooperation between their defense industries for joint development and production.

“We want to elevate the relations between India and Germany to an even higher level,” Modi said.

Germany has not traditionally had close defense ties with India, but the two sides have been trying to boost cooperation in the sector. Germany’s Thyssenkrupp is expected to partner with Indian firms to build six advanced conventional submarines in India, part of New Delhi’s ongoing efforts to modernize its naval capabilities.

Merz said India and Germany share “tremendous economic potential,” and the two countries are working together to strengthen ties in the field of security policy and defense cooperation.

“India is a desired partner, a partner of choice for Germany,” Merz said, according to a live official translation. He added that negotiations on a free trade agreement between India and the EU need to be concluded to fully realize the potential of economic ties between the two countries.

The two sides also signed an agreement that makes it easier for Indians to work in Germany's health care sector.

Merz’s visit to India — also his first to an Asian country since he took office last year — comes ahead of a planned India-EU summit later this month, where leaders hope to make progress on a long-pending free trade agreement. India hopes to deepen economic engagement with Europe in the face of US tariff rates of 50%.

During his visit, Merz toured the Sabarmati Ashram, once home to independence leader Mahatma Gandhi, and attended the International Kite Festival at the Sabarmati riverfront. Modi and Merz flew kites during the event.



Lebanon Sinks Deeper into Conflict, but Bonds Hit Six-year Highs

Smoke rises after an Israeli strike on Beirut's southern suburbs, following an escalation between Hezbollah and Israel, amid the US-Israeli conflict with Iran, Lebanon, March 4, 2026. REUTERS/Khalil Ashawi
Smoke rises after an Israeli strike on Beirut's southern suburbs, following an escalation between Hezbollah and Israel, amid the US-Israeli conflict with Iran, Lebanon, March 4, 2026. REUTERS/Khalil Ashawi
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Lebanon Sinks Deeper into Conflict, but Bonds Hit Six-year Highs

Smoke rises after an Israeli strike on Beirut's southern suburbs, following an escalation between Hezbollah and Israel, amid the US-Israeli conflict with Iran, Lebanon, March 4, 2026. REUTERS/Khalil Ashawi
Smoke rises after an Israeli strike on Beirut's southern suburbs, following an escalation between Hezbollah and Israel, amid the US-Israeli conflict with Iran, Lebanon, March 4, 2026. REUTERS/Khalil Ashawi

Lebanon's defaulted sovereign bonds scaled fresh six-year highs on Thursday as the widening conflict in the Middle East fuelled hopes that a weakened Hezbollah could pave the way for the country to emerge from its years-long crisis.

The war-torn nation's longer-dated bonds have added as much as 2 cents since Friday's close, with much of the curve now trading between 30.5 cents and 31.5 cents on the dollar, the highest levels since spring 2020 when the fallout from the COVID pandemic roiled global markets. The debt has been among the best performers in 2026, returning investors nearly 33%. The latest gains come as Hezbollah launched rockets and drones into Israel on Monday prompting ongoing full-blown hostilities with Israel.

"Weaker Iran/Hezbollah makes it easier to move on with a disarmament, and improves governability," said Bruno Gennari at KNG Securities. "You might not see that improvement today, but in the medium- to long-term."

Lebanon defaulted on its $31 billion of outstanding international bonds in March 2020 during a spiralling financial crisis that wiped out banks' balance sheets and cost the country's currency 99% of its value.

Emerging from the spiral has been slow.

The formation of a new government just over a year ago after two years of paralysis raised hopes among investors that authorities would bring the country closer to accessing reconstruction funds and emerge from its default.

However, policymakers will still have to navigate a myriad of fiscal and economic challenges, including a contentious banking sector restructuring and shaping the contours of its medium-term fiscal strategy. Meanwhile, its location at the center of Middle East conflicts and delayed elections - scheduled for May but now postponed due to the conflict with Israel - add to the uncertainties.

Lebanon requested a program with the International Monetary Fund a year ago and a mission from the Washington-based lender of last resort visited Beirut last month.


DHL Continues to Accept Middle East Orders, but Warns of Delays

FILE PHOTO: A view shows a DHL plane at the airport of Almaty, Kazakhstan December 5, 2024. REUTERS/Pavel Mikheyev/File Photo
FILE PHOTO: A view shows a DHL plane at the airport of Almaty, Kazakhstan December 5, 2024. REUTERS/Pavel Mikheyev/File Photo
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DHL Continues to Accept Middle East Orders, but Warns of Delays

FILE PHOTO: A view shows a DHL plane at the airport of Almaty, Kazakhstan December 5, 2024. REUTERS/Pavel Mikheyev/File Photo
FILE PHOTO: A view shows a DHL plane at the airport of Almaty, Kazakhstan December 5, 2024. REUTERS/Pavel Mikheyev/File Photo

DHL is still accepting delivery orders in the Middle East despite the escalating conflict, its chief executive said on Thursday, but warned there would be delays.

The escalation of the US-Iran war affects the whole region, including deliveries to Israel that are currently moved via Cyprus, CEO ⁠Tobias Meyer told ⁠a press conference after the German logistics group's annual results.

Meyer added that DHL still adheres to its investment plans in the Middle ⁠East.

"Those are long-term investments and we're of the opinion that the region is still attractive," he said.

Logistics and shipping companies are facing mounting disruption across air and sea routes as the conflict entered its sixth day. Iran’s closure of the Strait of ⁠Hormuz ⁠on Sunday forced major ocean carriers including Maersk, Hapag-Lloyd and CMA CGM to once again divert vessels around Africa, adding significant transit time and costs.

US parcel giant FedEx said on Monday it was temporarily halting services in five countries in the region.


Iran Crisis Could Disrupt Supply of Key Chipmaking Materials, South Korea Warns

Semiconductor chips on a computer circuit board in an illustrative image (Reuters)
Semiconductor chips on a computer circuit board in an illustrative image (Reuters)
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Iran Crisis Could Disrupt Supply of Key Chipmaking Materials, South Korea Warns

Semiconductor chips on a computer circuit board in an illustrative image (Reuters)
Semiconductor chips on a computer circuit board in an illustrative image (Reuters)

The US-Israel war with Iran could disrupt supplies of key semiconductor manufacturing materials, a South Korean ruling party lawmaker said on Thursday, as the conflict in the Middle East entered its sixth day.

South Korea's chip industry, which supplies around two-thirds of global memory chips, is also concerned that a prolonged conflict in Iran will lead to higher energy costs and prices, Kim Young-bae said after meeting with executives from companies such as Samsung Electronics and trade groups.

"Officials raised a possibility that semiconductor production could be ‌disrupted if ‌some of these key materials cannot be sourced from the ‌Middle ⁠East," he said ⁠at a briefing with reporters, giving helium as one example.

Helium is essential for heat management during semiconductor production and it has no viable alternatives currently. It is only produced in a handful of countries, with Qatar among the leading players in the industry.

The warnings come as chipmakers grapple with severe supply bottlenecks due to surging chip demand from AI data center operators that has tightened supplies to many other industries, including smartphones, laptops and ⁠automobiles.

South Korean chipmaker SK Hynix said in a statement it ‌has "long secured diverse supply chains and sufficient inventory" ‌of helium, "therefore there is almost no chance that the company will be affected."

Samsung declined to comment.

Taiwan's ‌TSMC said in a statement that it did not anticipate any significant impact ‌currently, and will continue monitoring the situation closely.

Contract chipmaker GlobalFoundries said it is "in direct contact with suppliers, customers and partners in the region", and "mitigation plans" are in place.

South Korea's industry ministry said the country relies heavily on the Middle East for 14 other items in chip ‌supply chains, including bromine and chip inspection equipment, but that many of them can be sourced domestically or from other markets.

IMPACT ON ⁠DATA CENTRES

South Korea's ⁠chip industry also warned the crisis could deal a setback to plans by big tech firms to build AI data centers in the Middle East in the longer term, thus weighing on chip demand, said Kim, the ruling party lawmaker. Amazon said on Monday some of its data centers in the United Arab Emirates and Bahrain were damaged by drone strikes, sparking questions around Big Tech's pace of expansion in the region.

US tech giants like Microsoft and Nvidia have been positioning the UAE as a regional hub for artificial intelligence computing needed to power services such as ChatGPT. Iran launched a wave of missiles at Israel early on Thursday in retaliation for US and Israeli strikes that killed Supreme Leader Ali Khamenei on Saturday.