Sectors like human resource exchange also offer opportunities

The relationship between India and the countries in the Gulf region has evolved from being mere buyer and seller. The
partnerships which were once restricted to the demand and supply of oil, gas and other petroleum products, have now evolved into cooperative partnerships with India exploring opportunities in the West Asian region.

The Ministry of External Affairs' secretary, Sanjay Bhattacharyya said at a recent event that India and the Arab countries have many opportunities to explore in the sectors such as human resource exchange, technology and economy. In fact, Indians are the largest expatriate community in the Arab world with nine million workers and professionals forming 30 percent of all expat work force in the region.

Speaking at LEADS 2020 FICCI Seminar held recently, the MEA Secretary (CPV-OIA) said, “With both India and the Arab region engaged in restructurings and transformational changes in the economy, the strong political understanding and goodwill between the people provide the tremendous potential to take the economic relationship to a higher level.”

India and the countries in the Gulf have ample opportunities to explore in human resources for which, he said, countries can, “skill mapping and skill matching of the employees will reduce transaction cost of hiring and ensure a competent workforce with improved job security and better compensation.”

Similarly, the economic engagement between India and the Gulf region is one of the driving forces of the growing relationship and the most vibrant aspect, he said calling the area with tremendous potential.

“Two-way investments can increase significantly, with sovereign wealth funds and portfolio investments from the Gulf region and Indian corporate investments playing a leading role,” he said. “The development of joint projects on both sides and in third-countries, stronger corporate presence, expansion of connectivity and people-to-people exchanges can add a new dimension to these ties,” he said further.

In fact, the partnerships in the oil and gas sector can also be further improved given that India imports 53 per cent of the oil and 41 per cent of the gas from the region. India has stakes in oil blocks in Iraq, Syria, Libya, the UAE, Yemen and South Sudan.

According to Bhattacharyya, the West Asian countries can help in development of the oil and gas reserves in India.

“Developing the significant fields in Kutch district, Cauvery basin, Mahanadi basin, Hugli basin and offshore locations in Bay of Bengal will broaden hydrocarbon production and provide win-win solutions longer into the future,” he said.

Similarly, India and the countries in Arab and Gulf can look for collaborations in solar energy and other renewables, he said, citing associations with the International Solar Alliance.

However, the trade between India and the West Asian region can be extended to goods beyond hydrocarbons. The countries can include engineering goods, gems and jewellery, precious metals, food products, textiles and chemicals in their trade basket, he said. Such products “in our exports and new products in our imports can give impetus to our trade relations,” he said.

Now, the relationship between India and the Arab world has seen a steady rise in the past few years with India emerging as one of the important nations in this respect.

This becomes even more evident with a recent statement by Israeli Ambassador to India, Ron Malka who said that there is a possibility of a ‘Trilateral Bloc’ in West Asia comprising India, Israel and the United Arab Emirates as partners at a time when Israel has entered a ‘peace deal’ with the UAE and
Bahrain.

According to a report by The Economic Times, he said, “If India looks towards West geo-politically, a trilateral between India, Israel and the UAE is in the realm of possibility. India's wide-ranging ties with both Israel and the UAE are a factor that can shape this trilateral. This is not a mere speculation but very much in the realm of possibility.”

He also said that India can bridge the gap between Israel and other West Asian countries as it has cordial relationships with almost all of them including Palestine.

“India and Israel have come a long way since creation of diplomatic ties in 1992. The achievements in the last 28 years have been phenomenal. India’s ties with Israel and Palestine have been de-hyphenated — India has strong ties with Tel Aviv while maintaining traditional ties with Palestinian authorities,” he told the ET.

With Israel, From US$ 200 million in 1992 comprising primarily trade in diamonds, bilateral merchandise trade stood at US$ 5.65 billion excluding defence in 2018-19, the MEA data suggested. India is also Israel's third largest trade partner in Asia and seventh largest globally.

Apart from that, there are over 300 investments from Israel in India mainly in the high-tech domain and in agriculture, the MEA data said further.

India has also established relations with other nations in the region such as Kuwait, the UAE, Saudi Arabia and many more. In Kuwait, India enjoyed a great relationship with former Emir Sheikh Sabah Al-Sabah, who died at the age of 91 on September 29. India even held a national day of morning on October 4 to remember him.

Nevertheless, India is moving closer to boost existing relationships with the oil rich country. Indian Ambassador to Kuwait Sibi George recently met with Kuwaiti President of National Security Bureau Sheikh Thamer Al-Ali Al-Sabah and discussed bilateral relations. The Embassy later informed about the same on twitter.

It wrote, “Ambassador met Sheikh Thamer Al-Ali Al-Sabah, President of National Security Bureau on Oct 14, and discussed inter alia bilateral relations, ways of strengthening and broadening existing cooperation, matters of mutual interest and latest regional and international development.”


Similarly, with the UAE, India has moved ahead in the bilateral economic partnerships. According to the data by the Ministry of External Affairs, the annual trade which was around US$180 million in the 1970s climbed up to US$60 billion in 2018-19 making the UAE India’s third largest trading partner. The UAE became the second largest importer of Indian products with US$30 billion in 2018-19.

With US$36 billion of non-oil trade, it became the third largest trading partner of India, according to the government data. Indian investments in the UAE were estimated at around $85 billion.

Apart from that, the UAE also invested in India’s Petroleum sector in South India.

India and the UAE are also advancing towards their defence cooperation partnerships. It is also interesting to see how the UAE has been helping India in building ties with Gulf countries with its dominance in the Organisation of Islamic Cooperation (OIC).

As far as OIC is concerned, Saudi Arabia and the UAE blocked Pakistan’s bid to embarrass India on Kashmir’s issue during the OIC meeting held in March this year.

As far as trade is concerned, Saudi Arabia happens to be one of the biggest trade partners of India. According to the Ministry of External Affairs’ (MEA) data, Saudi Arabia is India’s fourth largest trade partner and is a major source of energy as India imports around 18 percent of its crude oil requirement from the Kingdom.

In fact, Saudi Arabia this year surpassed Iraq in being the biggest oil supplier to India.

The relationships between India and the Arab countries have seen a boost despite the current COVID-19 scenario. In fact, during the pandemic, the relationship passed the test of time to become even stronger. India made efforts throughout the world to minimize the impact of COVID-19. In the Arab region, India cooperated with the repatriation of stranded citizens on both sides.

India has provided medical aid and supplies to Arab countries and deployed medical teams while cooperating with them in COVID-19 research and testing. India has also promised these countries vaccines once it concludes their human trials.