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India’s trade with Gulf Cooperation Council increasing at rapid pace

These increasing figures assume significance as India is looking at negotiating a free trade agreement with the grouping.

GCC trade
India will pitch for permission to export grains from official reserves through government-to-government deals, to help countries tide over a food shortage and for humanitarian purposes. (Reuters)

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

Here is a look at bilateral trade India has with the Gulf nations: India imports predominately crude oil and natural gas from the Gulf nations like Saudi Arabia and Qatar, and exports pearls, precious and semi-precious stones; metals; imitation jewellery; electrical machinery; iron and steel; and chemicals to these countries.

During 2020-21, India imported goods worth USD 110.73 billion from the six GCC (Gulf Cooperation Council) nations. Its merchandise exports stood at USD 44 billion to these nations.

Besides 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 send a significant amount of money back home.

According to a November 2021 report of the World Bank, India got USD 87 billion in foreign remittances in 2021. Of this, a sizeable portion came from the GCC nations.

Trade with GCC nations:

1. Saudi Arabia: It was the fourth-largest trading partner last fiscal. Total bilateral trade has increased to about USD 43 billion in 2021-22 from USD 22 billion in the previous fiscal.

2. Qatar: India imports 8.5 million tonnes a year of LNG 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 9.21 billion in 2020-21.

3. Kuwait: It was the 27th largest trading partner of India in the last fiscal. Bilateral trade has jumped to USD 12.3 billion in 2021-22 as compared to USD 6.3 billion in the previous financial year.

4. UAE: It was the third-largest trading partner of India in 2021-22. India’s bilateral trade with the nation increased to USD 72.9 billion in 2021-22 as compared to USD 43.3 billion in 2020-21.

5. Oman: It 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 5.5 billion in 2020-21.

6. Bahrain: Two-way commerce with India stood at USD 1.65 billion in 2021-22 as against USD 1 billion in 2020-21.

Besides, India’s bilateral trade with Iran aggregated to USD 1.9 billion in 2021-22 as compared to USD 2.1 billion in 2020-21.

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