India-Gulf Relations

In News

• Recently, three countries in the Gulf region had summoned the Indian ambassadors to their nations to register their protest, and demanded a public apology from India.
  • There was an ongoing controversy over suspended BJP spokesperson Nupur Sharma’s remarks on the Prophet.

India and Gulf Region 

• About: 
  • The Pakistan-sponsored attack on Mumbai in 2008 affirmed the shared threat that the GCC and India were exposed to from extremist elements nurtured by Pakistan. 
  • This provided the rationale to elevate India-GCC ties to a strategic partnership that was given formal shape by the ‘Riyadh Declaration’ in 2010. 
  • This enjoined the two sides to pursue the expansion of ties in political, security, defence, economic and cultural areas.
• Changing Relations: 
  • The significant presence of the Indian community in the Gulf countries over the last 40 years and the role of Indian enterprises in the development of the region have brought important changes in bilateral political and economic relations. 
  • The Prime Minister Of India focused on the region from the beginning of his term with a series of visits to all the major regional capitals in 2015-16 and encouraging return visits. 
  • The joint statements issued at the end of each high-level interaction share several common features. 
  • Each of them celebrates India’s age-old civilisational ties with the region, applauds India’s democratic order, and recognises the relationship as a strategic partnership.

Significance of Gulf for India

• Good relations: India has enjoyed centuries of good relations with countries like Iran, while smaller gas-rich nation Qatar is one of India’s closest allies in the region. India shares good relations with most of the countries in the Gulf.
• Gas and Trade:
  • Gulf Cooperation Council (GCC)has emerged as a major trading partner of India and has vast potential as India’s investment partner for the future. 
    • The GCC’s substantial oil and gas reserves are of utmost importance for India’s energy needs.
    • GCC includes: UAE, Bahrain, Saudi Arabia, Oman, Qatar and Kuwait.
  • UAE: The UAE was India’s third largest trading partner in 2021-2022, and second largest for both exports ($28 billion) and imports ($45 billion) when these are counted individually. 
    • In terms of total trade volume, the UAE ($72.9 billion) was behind the United States ($1.19 trillion) and China ($1.15 trillion). 
    • The UAE accounted for 6.6% of India’s total exports and 7.3% of imports in the last financial year, up 68.4% since the previous year when international trade was impacted by the pandemic.
    • The UAE accounts for 11 natural gas exports to India%.
  • Saudi Arabia: At a total volume of $42.9 billion in 2021-22, Saudi Arabia was India’s fourth largest trading partner. 
    • While exports were low at $8.76 billion (2.07% of India’s total exports), imports from Saudi Arabia were the fourth largest at $34.1 billion (7%), up 50% from the previous year. Most of it was crude oil.
  • Iraq: It was India’s fifth largest trading partner in 2021-22 at $34.3 billion.
  • Qatar: The total trade was $15 billion, accounting for just 1.4% of India’s total trade, but the country is India’s most important supplier of natural gas.
    • Qatar accounts for 41% of India’s total natural gas imports. 

Image Courtesy: ET 

• Crude Oil and Petroleum Import: 
  • The share of Persian Gulf countries in India’s crude imports has remained at around 60% over the last 15 years.
  • In 2021-2022, the largest exporter of oil to India was Iraq, whose share has gone up from 9% in 2009-2010 to 22%. 
  • Saudi Arabia has accounted for 17-18% of India’s oil imports for over a decade. 
  • Kuwait and UAE remain major oil exporters to India. 
• Indians Diaspora: Counting only the 13.4 million non-resident Indians (NRIs), the Gulf has the largest numbers. The UAE (3.42 million), Saudi Arabia (2.6 million) and Kuwait (1.03 million) together account for over half of all NRIs.

Image Courtesy: ET 

• Remittances: 
  • In terms of remittances from abroad, India was the largest recipient in 2020 at $83.15 billion, according to World Bank data. 
  • This was nearly twice the remittances to the next highest recipient, Mexico, at $42.9 billion.
  • The largest contributor is the huge Indian diaspora in the Gulf. 
  • The GCC countries accounted (in 2018) for more than 50% of the total $69 billion remittances received by India in 2016-17. 
  • The UAE accounted for 26.9%, Saudi Arabia for 11.6%, Qatar for 6.4%, Kuwait for 5.5% and Oman for 3%. Beyond the GCC, remittances from the US accounted for 22.9%, second only to the UAE.

Indian Government’s Efforts

• Special Focus: Since coming to power in 2014, the present Government has kept a special focus on maintaining or enhancing India’s relations with most of the countries in the region. 
• Visits to the Region: The Indian Prime Minister (PM) has visited the region several times since 2014. 
  • He visited the UAE in 2015, 2018 and 2019, and Abu Dhabi’s crown prince came to India in 2017 and 2018. 
  • Visits were made to Qatar and Iran in 2016, and Saudi Arabia in 2016 and 2019. 
  • In 2018, he went to Jordan, Palestine and Oman besides UAE, and became the first Indian Prime Minister to visit the Palestinian territory of Ramallah. 
  • He visited Bahrain in 2019.
  • There have been similar reciprocal visits by leaders from these countries during these eight years. 
  • Even during the pandemic, Indian and Gulf region leaders maintained regular contact.
• Highest civilian honour: Due to this, Palestine, Iran, Saudi Arabia, UAE and Jordan have excellent relations with India and Maldives and Bahrain have bestowed their highest civilian honour on India’s Prime Minister.
• Giving importance to their religion: On his trips, the Indian Prime Minister has also visited some of the most popular mosques in those countries, including the Sheikh Zayed Grand Mosque in Abu Dhabi in 2015, and the Sultan Qaboos Grand Mosque in Muscat in 2018.

Way Ahead

• Avoiding any such conflicts, there must be a clear synergy in India and the GCC countries consolidating their traditional areas of cooperation — energy, trade and investment.
• They need to adopt an integrated and cohesive approach to develop ties in diverse areas — renewables, water conservation, food security, digital technology and skills development.

Source: IE