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NEW DELHI: After a delay of several months, India and the Gulf Co-operation Council (GCC) have begun discussing the contours of a free trade agreement, which may not include a bilateral investment treaty.
Through the agreement, India will be eyeing a large and affluent market for its goods and also concessions on visas in a region, which has traditionally seen a flow of a large number of Indian workers and professionals.In return, it will also hope to attract investment.
But officials indicated that a bilateral investment treaty may be replaced by a chapter in the agreement, and both sides are seen to be open to this kind of a deal. Detailed negotiations for the proposed treaty are yet to begin, sources told TOI.
While the six-nation GCC – comprising Saudi Arabia, the UAE, Kuwait, Qatar, Bahrain and Oman – had indicated their intent to move ahead with the proposed FTA more than a year ago, there was reluctance in certain sections, leading to a delay. After the UAE, this will be the second trade pact in the region, with sources indicating that Oman too has shown its intent to sign a separate agreement.
The agreement with GCC was planned during the UPA regime but was put on the backburner amid a huge gap in positions. It was only after India walked out of RCEP that the government reopened trade negotiations and has gone ahead and signed at least three treaties that were in the pipeline for years – Maldives, the UAE and an interim agreement with Australia – with the UK and EU under negotiation.
India’s exports to the GCC nations was pegged at over $51 billion during the last financial year, with shipments valued at nearly $21 billion during April-August this year. Oil products, gems and jewellery, electrical machinery, chemicals and cereals are among India’s top export items. On the other hand, imports were valued at $133 billon during 2022-23 and just over $39 billion during April-August this year.
Through the agreement, India will be eyeing a large and affluent market for its goods and also concessions on visas in a region, which has traditionally seen a flow of a large number of Indian workers and professionals.In return, it will also hope to attract investment.
But officials indicated that a bilateral investment treaty may be replaced by a chapter in the agreement, and both sides are seen to be open to this kind of a deal. Detailed negotiations for the proposed treaty are yet to begin, sources told TOI.
While the six-nation GCC – comprising Saudi Arabia, the UAE, Kuwait, Qatar, Bahrain and Oman – had indicated their intent to move ahead with the proposed FTA more than a year ago, there was reluctance in certain sections, leading to a delay. After the UAE, this will be the second trade pact in the region, with sources indicating that Oman too has shown its intent to sign a separate agreement.
The agreement with GCC was planned during the UPA regime but was put on the backburner amid a huge gap in positions. It was only after India walked out of RCEP that the government reopened trade negotiations and has gone ahead and signed at least three treaties that were in the pipeline for years – Maldives, the UAE and an interim agreement with Australia – with the UK and EU under negotiation.
India’s exports to the GCC nations was pegged at over $51 billion during the last financial year, with shipments valued at nearly $21 billion during April-August this year. Oil products, gems and jewellery, electrical machinery, chemicals and cereals are among India’s top export items. On the other hand, imports were valued at $133 billon during 2022-23 and just over $39 billion during April-August this year.
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