New Delhi. After showing momentum in trade agreements with the European Union and America, now Gulf countries also seem eager to join hands with India. This is not just a coincidence, but shows India’s growing economic strength in the changing global equations. The big economies of the world are now looking at India not just as a market but as a partner power. Let us tell you that a big step has been taken towards a free trade agreement between India and the Gulf Cooperation Council, a group of six countries in the Gulf region. Both sides are signing the outline of the talks in the presence of Commerce and Industry Minister Piyush Goyal. This framework will determine the scope, method and priorities of the upcoming talks. In this way, the process that had been stuck for almost two decades now seems to be gaining momentum again. The Gulf Cooperation Council includes Saudi Arabia, the United Arab Emirates, Qatar, Kuwait, Oman and Bahrain. India has already signed a free trade agreement with the UAE and a comprehensive economic partnership agreement with Oman. After this, now a comprehensive agreement with the entire group is being considered as the next big step in India’s trade policy.
The basis of trade between India and Gulf countries till now has been energy. India has been importing a large part of its crude oil and gas from these countries. Saudi Arabia and Qatar are the main pillars of India’s energy security. On the other hand, India sends pearls, precious and semi-precious stones, metals, artificial jewellery, electrical equipment, iron, steel and chemicals to these countries. Statistics show that trade between the two sides is continuously increasing. In recent years, India’s exports stood at around $57 billion, while imports reached above $121 billion. Total bilateral trade has exceeded $178 billion. This level in itself tells the depth of this relationship.
Gulf countries are also a big center for Indian migrant workers. Of the more than three crore Indians who live abroad, a large number work in this sector. They send huge amount of money to India every year, which is an important support for the country’s economy. Earlier too, two rounds of talks had taken place between India and the group, but the process came to a halt after 2008. The talks had stalled due to differences over tariff cuts, investment protection and the group’s internal priorities. Now an attempt has been made to break the deadlock by keeping the investment treaty and trade agreement on different paths.
India has recently shown progress in trade talks with the EU and the US. In such an environment, the new initiative with the Gulf region indicates that New Delhi is now viewing trade agreements not only as an economic but also as a strategic instrument.
The move towards free trade agreements with Gulf countries is also just a sign of changing world politics. The world’s power is no longer determined by weapons alone, but by markets, supply chains and energy routes. Only the country that secures stable energy sources and open markets for itself will stand strong in the coming decades. India has long pursued a cautious and sometimes hesitant trade policy. But now the situation is changing. To become a global power, India will have to open its big markets. The Gulf region is a natural partner in this because it has energy, wealth, investment potential and a huge manpower working for India is also present here.
However, it would not be right to turn a blind eye to this enthusiasm. Free trade agreements mean opening up our markets. If domestic industries are not prepared, cheap imports can hit many sectors. Therefore, the government will not only have to rush to sign the agreement but will also have to be equally concerned about strengthening the domestic industry, agriculture and service sector.