Foreign Policy Watch: India – EU

Schengen Area: A Milestone in European Integration


From UPSC perspective, the following things are important :

Prelims level: Schengen Area, Eurozone

Mains level: NA

Schengen Area


  • Kosovo recently achieved visa-free access to the Schengen zone in Europe, marking a significant milestone in its integration with the European Union (EU) and the broader international community.

What is Schengen Area?

  • Definition: A zone comprising 27 European countries where internal borders have been abolished for the free movement of people.
  • Membership: Includes 23 of the 27 EU member states and all members of the European Free Trade Association (EFTA) – Iceland, Liechtenstein, Norway, and Switzerland.
  • Key Features:
    1. No internal border checks except in specific threat situations.
    2. Harmonized controls at external borders based on defined criteria.

About Eurozone

  • A geographic and economic region consisting of European Union countries that have adopted the euro as their national currency.
  • As of January 2023, consists of 20 EU countries: Austria, Belgium, Croatia, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Portugal, Slovakia, Slovenia, and Spain.
  • Key Features:
    1. Coordination of economic policy-making to support EU economic aims.
    2. Replacement of national currencies with the euro.

Requirements for Joining the Eurozone

EU nations must meet specific criteria, including four macroeconomic indicators:

  1. Price Stability: Maintain sustainable price performance with average inflation no more than 1.5 percent above the rate of the three best-performing member states.
  2. Public Finances: Maintain a budget deficit no greater than 3% of GDP and public debt no greater than 60% of GDP.
  3. Durability of Convergence: Assessed through long-term interest rates, which cannot exceed 2 percent above the rate in the three most price-stable member states.
  4. Exchange Rate Stability: Demonstrate stability by participating in the Exchange Rate Mechanism (ERM) II for at least two years without severe tensions or devaluation against the euro.

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