The free trade agreement will be discussed between India and GCC -

New Delhi: India will discuss a free trade agreement with the Gulf Cooperation Council-GCC, comprising six Gulf countries: Saudi Arabia, United Arab Emirates (UAE), Bahrain, Kuwait, Oman and Qatar. The discussion will start next month, and the agreement is believed to be concluded with negotiations by the middle of 2023. After the Coronavirus pandemic, there has been a significant increase in trade between India and GCC member countries. Economists claim that the Indian economy will take a giant leap if the free trade agreement with the GCC is concluded.

In the financial year of 2020-21, bilateral trade between India and GCC member countries stood at $87 billion. India’s trade with GCC countries crossed over $154 billion in the fiscal year 2021-22. Compared to the financial year 2020-21, India’s exports to GCC countries in 2021-22 have increased to a staggering 58%. India imports crude and natural fuel gas from GCC countries. Saudi Arabia and Qatar are the leading countries to export this to India. Contrarily, India exports pearls, diamonds, metals, artificial ornaments, electric machines, crude iron and chemicals to GCC countries.

In addition, India has prepared a list of about 1100 products to increase exports to GCC countries. These include ACs, refrigerators, spices, tobacco, cotton garments, textiles and leather products. Moreover, the world’s supply chain has been disrupted after the outbreak of the Coronavirus pandemic and the subsequent conflict that erupted in Ukraine. Every major country in the world faces the brunt of this. However, India has remained away from its side effects, and India’s manufacturing sector has been getting a boost during the period. China, a country considered the factory of the world, has suffered a lag for many reasons, and with this background, India’s performance has prominently surfaced in the world. At the same time, the world has noticed the significance of India’s vast market more sharply.

GCC member states have strained relations with the European Union over human rights violations and many other issues. Also, the US and European countries are upset with the Gulf countries, which are members of the GCC, for not withdrawing the decision to cut fuel production. Consequently, the US has started using the language of teaching a lesson to Saudi Arabia, a country that leads the GCC. In such a situation, it becomes noteworthy that the GCC has begun discussions on a new free trade agreement with India. Earlier, India had discussed a free trade agreement with the GCC. But it had not been very successful. But now, the GCC member countries have realised the importance of this free trade agreement with the changed situation. UAE, the GCC member country, has already signed a free trade agreement with India and hence gets to see an affirmative impact on trade between the countries. Besides, there are indications that GCC has taken notice of this.

The International Monetary Fund (IMF) claimed a few days ago that the trade partnership between India and the GCC has a considerable scope. Importantly, this trade agreement between India and the GCC is economical and of great political and strategic importance. It is claimed that India’s influence on the Gulf region will increase more in the near future. Analysts in Pakistan have also started to agree that this proves to be a massive success for the foreign policy adopted by India.