India GCC to negotiate a Free Trade Agreement on 24 November

India and the Gulf Cooperation Council are expecting to launch talks over a free trade agreement (FTA) regime around 24th November aimed at boosting economic ties between the two parties. 

The Gulf Cooperation Council or the GCC consists of a union of six countries namely Saudi Arabia, UAE, Qatar, Kuwait, Oman and Bahrain. It is a regional intergovernmental, political and economic union of the nations of the Gulf region.

 The GCC officials said that the FTA will be launched on November 24.

India already signed a free trade pact with the UAE earlier this year, in May.

The minister for Commerce and Industry, Piyush Goyal on November 16 said that India and GCC will come up with a new free trade agreement on 24th November.

Two rounds of negotiations were earlier held back in 2006 and 2008 between the two parties.

This agreement would be a resumption of the earlier talks. A third round of negotiation was supposed to take place however, it did not occur as the GCC deferred its talks with any country or economic group.

India has a history of importing crude oil and natural gas from the Gulf countries of Saudi Arabia and Qatar and exports, precious and semiprecious stones, pearls, imitation jewelry and other machinery and chemicals. 

The share of the GCC countries in India’s total export rose to 10.4% in 2021-22 from 9.51% in 2020-21. Imports rose by 85.8% to 110.73 billion USD from 59.6 billion USD, as per the data. 

The share of GCC countries in India’s total imports has risen to 18% in 2021-22 from 15.5% in 2020-21.

The bilateral trade also increased from 87.4 billion USD to 154.73 billion USD in 2021-22.

India has about 32 million non-resident Indians (NRIs) out of which half of them work in Gulf countries. Hence, these nations host a considerable size of Indian population.

These non-resident Indians send back money and remittances back home. The World Bank report of 2021 estimated that India received around 87 billion USD as foreign remittances in 2021 and a considerable portion came in from the GCC countries.

Saudi Arabia was India’s fourth largest trading Partner last year and Kuwait was the 27th largest trading partner of India. While the UAE was the third largest trading partner in the fiscal year 2021-22. 

Piyush Goyal, Minister of Commerce and Industry while addressing the Consumer Electronics and Appliance Manufacturers Association 43rd annual function in New Delhi remarked that the developed countries around the world are keen on negotiating free trade agreements and economic partnerships with India.

He also announced other free trade agreements with the UK, Canada, European Union and Israel along with one more with the GCC to be launched next week.

He lauded the country’s 1.4 billion people who provide such a large market to the world and said that this was a calling card which forces other nations to engage with India today due to its market.