The office of the Vice President of India recently made headlines with a visit to Qatar, a member of the Gulf Cooperation Council (GCC). The GCC is comprised of Bahrain, Kuwait, Qatar, Oman, Saudi Arabia, and the United Arab Emirates. During his visit, the Vice President emphasized the strength of the India-Qatar relationship and called for an enabling environment and increased collaborations for mutual benefit.
Key Features of the Visit
Several significant initiatives were introduced during this visit. The first being the “India-Qatar Start-Up bridge”, intended to connect the start-up ecosystems of both nations. With over 70,000 registered startups and 100 unicorns valued over USD 300 billion, India has emerged as the third largest ecosystem for startups worldwide.
On the environmental front, India’s efforts in combating climate change were highlighted. The Vice President recalled India’s leadership in establishing the International Solar Alliance (ISA) and increasing focus on renewable energy. He invited Qatar, a key partner in India’s energy security, to join the ISA.
A Joint Business Council between the Business Chambers of India and Qatar was also established. Furthermore, a Joint Task Force on Investments was set up to facilitate the councils’ work.
Finally, stronger collaboration between India and Qatar at multilateral forums like the Inter Parliamentary Union (IPU) and the Asian Parliamentary Assembly was suggested.
The Importance of the Gulf Region to India
India has maintained a strong relationship with several Gulf countries for centuries. Factors such as oil and gas, trade, a large Indian workforce in these countries, and their remittances have played a crucial role in deepening these ties.
India’s Trade Relations with Gulf Countries
The UAE, Saudi Arabia, Iraq, Qatar, and Oman all hold significant positions in India’s international trade. In terms of total trade volume, the UAE is India’s third-largest trading partner. Saudi Arabia and Iraq hold the fourth and fifth positions respectively. Although the total trade with Qatar is relatively low, it is India’s most important supplier of natural gas.
Oil Imports and the Gulf’s Role
India’s crude oil import largely depends on these Gulf countries. In the year 2021-2022, the largest exporter of oil to India was Iraq, followed by Saudi Arabia. Kuwait and UAE also remain major oil exporters to India.
Indian Diaspora in the Gulf and their Remittances
More than 13.46 million Indian citizens work abroad, with the majority residing in the Gulf region. The remittances from this Indian diaspora have been substantial, making India the largest recipient of remittances in 2020 according to World Bank data.
Recent Developments in Bilateral Relations
Recent developments include the signing of a Programme of Cooperation (POC) in the fields of Science and Technology between India and Oman for the period 2022 – 2025. The launch of negotiations on the India-UAE Comprehensive Economic Partnership Agreement (CEPA) was another significant move. Additionally, discussions on bilateral cooperation at multilateral forums such as the United Nations, G-20, and Gulf Cooperation Council (GCC) were held between the Indian External Affairs Minister and the Foreign Minister of the Kingdom of Saudi Arabia.
The Future of India-Gulf Relations
Looking ahead, there is much potential for economic cooperation between India and the Gulf countries, as they are diversifying their economies and investing in new ventures, including renewable energy, higher education, technological innovation, smart cities, and space commerce. The rise of Khaleeji capitalism has also led to Gulf countries providing economic and security assistance to friendly states, building ports and infrastructure, acquiring military bases, and brokering peace between warring parties and states. As such, India needs to bring scale and depth to its regional initiatives on connectivity and security in the Indian Ocean.