India Exim Bank released its study titled “Enhancing India’s Bilateral Relations with the GCC Countries: Trends in Trade, Migration and Remittances” in the presence of H.E. Mr. Munu Mahawar, Ambassador of India to Oman; H.E. Dr. Deepak Mittal, Ambassador of India to Qatar; H.E. Mr. Piyush Srivastava, Ambassador of India to Bahrain; and senior officials from the Embassy of India in Kuwait, Larsen & Toubro Limited and Afcons Infrastructure Limited, during a webinar titled “Enhancing India-GCC Relations: Prospects in Project Exports and Beyond” on October 06, 2020, hosted by India Exim Bank.
While India’s trade relations with countries in the Gulf region, have transformed considerably over the last decade, the structure and pattern is yet to be diversified, with huge potential for diversifying India’s exports especially into project exports.
The study analyses the two distinct areas of cooperation in India-Gulf economic relationship, viz. bilateral trade especially commodity trade, and migration from India resulting in a large expatriate community in the Gulf. The study highlights that GCC is one of India’s largest regional trading partner, with total trade averaging more than US$ 120 billion during the period 2009-2019. The study found that India continued to remain the second-largest export destination for GCC and its third largest import source, accounting for close to 10 percent each of GCC’s total exports and imports.
Behind this growing economic relationship, lies the vast Indian diaspora in the region. The GCC countries are home to over 9 million Indian migrants which has resulted in massive inflow of remittances to India amounting to US$ 48.5 billion in 2018. The study notes that both these intertwined aspects of India-Gulf ties have paved the way for further expansion of India-Gulf relations.
The study finds that avenues for cooperation, driven by mutual interests, could include the healthcare sector, research and development in the pharmaceutical sector, construction and development of petrochemical complexes, infrastructure development, agriculture and food processing, education and skill development among others.
The India Exim Bank study also suggests a few policy catalysts that could help boost bilateral cooperation which could include (i) expansion of trade based on identified commodities that India has potential to export, which would help in narrowing India’s high trade deficit with the Gulf; (ii) increased focus on project exports from India; (iii) diversification of markets; (iv) increased cooperation in services sector; and (v) improving trade logistics; among others.
Mr. David Rasquinha, Managing Director, India Exim Bank in his address highlighted that countries in the Gulf and especially the GCC have always been important trade partners for India and an important component of India’s extended neighbourhood.
The panellists deliberated upon the issues and current and future prospects for enhancing India’s engagements in and bilateral trade with the GCC region, in diversified areas. The Ambassadors urged more Indian companies to take advantages of the emerging opportunities.
Ambassador Mahawar, stressed that abundance of land, excellent infrastructure, ports, airports, roads, low utility cost especially low power cost, its strategic location and free trade arrangement makes Oman a preferred destination for Indian Investment. Oman in its ‘Vision 2040, has identified priority sectors for development towards diversification and India is considered as a strategic priority partner for Oman. He identified mining sector, transport infrastructure, health care as promising sectors for collaboration.
Ambassador Mittal opined that huge opportunities exist for Indian exporters in the pharmaceutical sector, oil and gas sector in Qatar and offered to extend support to Indian enterprises venturing to engage with partners in Qatar.
Ambassador Srivastava highlighted that opportunities exist in pharmaceutical products including alternative medicines, medical equipment, and renewable energy especially solar energy and in the fintech, digital and IT sectors in Bahrain and generally in the Gulf region.
Mr. Fahad Ahmed Khan Suri, Second Secretary (Political, Commerce and PIC), Embassy of India in the State of Kuwait in his address highlighted that there is significant potential to increasing bilateral trade not only in terms of volume but also in diversifying the existing base. Some of the potential areas for Indian exporters include energy, infrastructure projects, healthcare, automobiles, petrochemical and education.
For further information, please contact:
Mr. David Sinate, Chief General Manager, Research & Analysis Group, Export Import Bank of India, Centre One Building, Floor 21, World Trade Centre Complex, Cuffe Parade, Mumbai – 400005, T: 91-22-2217 2701, E-mail: email@example.com