Rapid Increase in India’s Trade with Gulf Cooperation Council

Gulf Cooperation Council UPSC: Relevance

• GS 2: Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests.

GCC and India: Context

• India’s trade with Gulf countries have come into prominence after the diplomatic row over derogatory comments made by the ruling BJP’s spokespersons against Prophet Muhammad.

खाड़ी सहयोग परिषद के साथ भारत के व्यापार में तीव्र वृद्धि

GCC UPSC: Key points

• India imports majorly crude oil and natural gas from the Gulf nations like Saudi Arabia and Qatar. On the other hand, the major exports include pearls, precious and semi-precious stones; metals; imitation jewellery; electrical machinery; iron and steel; and chemicals to these countries.
• Other than trade, Gulf nations are host to a sizeable Indian population. Out of about 32 million non-resident Indians (NRIs), nearly half are estimated to be working in Gulf countries. These NRIs contribute to Indian economy by sending significant remittances.

Trade with GCC

• Saudi Arabia: Saudi Arabia was the fourth-largest trading partner of India in the last fiscal. Total bilateral trade has increased to about USD 43 billion in 2021-22 from USD 22 billion in the previous fiscal.
• Qatar: India imports 8.5 million tonnes a year of LNG (Liquified Natural Gas) from Qatar and exports products ranging from cereals to meat, fish, chemicals, and plastics. Two-way commerce between India and Qatar rose to USD 15 billion in 2021-22 from USD 9 billion in 2020-21.
• Kuwait: Kuwait was the 27th largest trading partner of India in the last fiscal. Bilateral trade has jumped to USD 12 billion in 2021-22 as compared to USD 6 billion in the previous financial year.
• UAE: UAE was the third-largest trading partner of India in 2021-22. India’s bilateral trade with the nation increased to USD 72 billion in 2021-22 as compared to USD 43 billion in 2020-21.
• Oman: Oman was the 31st largest trading partner of India in 2021-22. India’s bilateral trade with the nation has increased to about USD 10 billion in 2021-22 as compared to USD 5 billion in 2020-21.
• Bahrain: Bahrain’s two-way commerce with India stood at USD 1.65 billion in 2021-22 as against USD 1 billion in 2020-21.

About GCC

• Established in 1981, the Gulf Cooperation Council (GCC) is a political and economic union of Arab states bordering the Gulf.
• GCC members: United Arab Emirates, Saudi Arabia, Qatar, Oman, Kuwait and Bahrain.
• The GCC’s prime geographical location is at the crossroads of the major Western and Eastern economies.
• Since the discovery of oil, the GCC region has undergone a profound transformation and is now home to some of the fastest growing economies in the world.
• The established and efficient air and sea connections and developed infrastructure make it a great place to establish and expand business.

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