Expanding Indo-Saudi Strategic Partnership | The Financial Express

Expanding Indo-Saudi Strategic Partnership

The bilateral trade continues to grow and overcome the slowdown caused by the Covid-19 pandemic in 2020-21. The volume of trade in the FY 2021-22 was $42.86 billion recording a 94 percent growth over 2020-21. Saudi Arabia continues to play a major role in India’s energy security and in 2021-22 it was the second largest source of hydrocarbon imports for India.

Expanding Indo-Saudi Strategic Partnership
External Affairs Minister S Jaishankar . (File)

By Md. Muddassir Quamar

India and Saudi Arabia have considerably expanded their bilateral relations over the past decades to emerge as strategic partners. The visit of Crown Prince Mohammed bin Salman to India in February 2019 and Prime Minister Narendra Modi’s visit to the Kingdom in October that year underlined the strengthening of the partnership with an eye on tapping the immense potentials for cooperation in different fields.

The focus on economic transformation has brought India and the Arab Gulf Kingdom closer in recent years. Greater political contacts, expanding trade and business relations and improved security and defense cooperation have given an unprecedented fillip to bilateral relations.

Saudi Arabia under King Salman and Crown Prince Mohammed has been rapidly transforming its economy to prepare for a post-oil future and to fulfill the aspirations of the 22 million Saudis. The Vision 2030 launched in 2016 is a comprehensive program for economic and social rejuvenation in the kingdom.

Accordingly, Riyadh plans to develop newer infrastructure and economic sectors including mining, shipping, aviation, tourism and sports, entertainment and recreation sectors to give boost to economic diversification. At the same time, the kingdom is investing in the clean energy sector including in wind, solar and Green Hydrogen to provide alternative and renewable sources of energy and preserve the hydrocarbons for future exports. These initiatives have started to pay off with the Kingdom witnessing the fastest growth in the Q1 of 2022 in over a decade.

On the other hand, India is among the fastest growing economies in the world. The size of its economy with a nominal GDP of US$3.5 trillion in 2022 makes it the fifth largest economy in the world. It is one of the largest consumers of hydrocarbons in the world and the expected growth of its economy and market makes it an attractive investment destination for the world.

For Saudi Arabia, which is also working to enhance and diversify its strategic investments in the global economy, India is one of the most attractive destinations given the robustness and depth of its economy. In the past five years, therefore, Saudi FDIs in India have witnessed a notable jump with over US$3 billion coming in the past five years. Simultaneously, Indian industries and businesses have significantly enhanced their presence and investments in the dynamic Saudi market.

The bilateral trade continues to grow and overcome the slowdown caused by the Covid-19 pandemic in 2020-21. The volume of trade in the FY 2021-22 was $42.86 billion recording a 94 percent growth over 2020-21. Saudi Arabia continues to play a major role in India’s energy security and in 2021-22 it was the second largest source of hydrocarbon imports for India. Indo-Saudi relations have also been boosted by cultural and people-to-people contacts with nearly 2.5 to 3 million Indian expatriates living and earning their livelihood in the kingdom.

In February 2019, when Crown Prince Mohammed visited India, the two countries had decided to form a Strategic Partnership Council to give further boost to cooperation in different areas. This was formalized during the October 2019 visit of PM Modi to the kingdom with four areas political & consular, legal & security, social & cultural and defense cooperation identified as the core areas where Joint Working Groups (JWG) were formed to further enhance cooperation. Accordingly, India’s Ministry of External Affairs (MEA) and Saudi Ministry of Foreign Affairs (MoFA) have formed the Committee on Political, Security, Social and Cultural (PSSC) cooperation under the India-Saudi Strategic Partnership Council.

The three-day (September 10-12, 2022) visit by the External Affairs Minister Dr. S. Jaishankar to the Kingdom of Saudi Arabia Comes at an opportune time. This will be the first visit by the EAM since taking office in 2019. During the visit, Dr. Jaishankar will co-chair the first ministerial meeting of the PSSC with his Saudi counterpart Prince Faisal bin Farhan.

Also Read: India’s Emerging Strategic Relations with the Gulf, especially the UAE

The preparatory meetings of the four JWGs under the PSSC between the two ministries have taken place over the past months as noted in the press release by the MEA. According to the release, the meeting will focus on “regional and international issues of mutual interest” including cooperation at multilateral forums such as the United Nations, G20 and Gulf Cooperation Council (GCC). The EAM will also meet other Saudi leaders as well as have an interaction with the Indian community.

India and Saudi Arabia have a robust and strong partnership. The bilateral relations have witnessed exponential growth over the past years and are expected to grow further. Saudi Arabia plays an important role in India’s energy security while India is a vital partner in the kingdom’s food security.

The leadership of the two countries recognize the immense potential for growth in trade, business and investments in existing and newer areas and have increased bilateral dialogue and discussion to realize these potentials. Further, there is a recognition of the extraordinary opportunities that lie in unexplored areas such as renewable energy, sports and recreation, defense production, higher education and tourism sectors and these are expected to be the core areas of discussion during the meeting between EAM Jaishankar and FM Prince Faisal.

The greater political understanding between PM Modi and King Salman and Crown Prince Mohammed has helped the two countries accelerate bilateral cooperation and strengthen strategic partnership in various areas including trade, business, investment, security, defense, counter-terrorism, food and energy security and cultural cooperation. The EAM’s visit is likely to give a further boost to the bilateral strategic partnership and pave the way for greater cooperation at bilateral, regional and international levels.

The author is Fellow, MP-IDSA, New Delhi. Views expressed are of the author. Twitter: @MuddassirQuamar

Disclaimer: Views expressed are personal and do not reflect the official position or policy of Financial Express Online. Reproducing this content without permission is prohibited.

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