India-Oman trade on the rise: Indian MEA
MUSCAT – Dr Ausaf Sayeed, Secretary (Consular, Passport, Visa & Overseas Indian Affairs) in India’s Ministry of External affairs, has stated that the Gulf Cooperation Council – including Oman – is currently India’s largest trading partner bloc with bilateral trade in 2021-22 valued at over US$154bn. Oman’s total trade with India was estimated at US$9.99bn.
“Our GCC trade included exports worth US$44bn (as against US$27.8bn in 2020-21, a growth of over 58 per cent) accounting for 10.4 per of India’s total exports in 2021-22 and imports from the GCC totalling US$110.73bn (a rise of 85.8 per cent), accounting for 18 per cent of India’s total imports during 2021-22. Imports are largely dominated by crude oil. Non-oil imports were worth US$37.2bn,” Sayeed said.
“Oman’s total trade with India was worth US$9.99bn in 2021-2022 compared to US$5.44bn in 2020-2021. While India’s imports in 2021-2022 were worth US$6.88bn, exports were worth US$3.14bn,” Sayeed added.
He pointed out that there are significant opportunities to enhance bilateral cooperation in several sectors. “There are several focus areas for cooperation between India and the GCC and other WANA countries, such as food security, supply chain, healthcare & pharma, energy security, renewable energy, including green hydrogen & green ammonia, rare earths, chips and semiconductors, and technology, including fintech & edtech.”
Sayeed informed that India has a Comprehensive Economic Partnership Agreement (CEPA) with UAE which was signed on February 18, 2022, and came into effect on May 1, 2022. “Negotiations on this landmark agreement were completed within 88 days of launch. It marks the first trade agreement that UAE has signed with any country. The agreement aims to increase bilateral trade to US$100bn by 2030 from trade of US$72bn in FY 2021-22.”
Separately India and the GCC have resumed discussions on concluding a free trade agreement. Terms of Reference have been exchanged and both sides are studying it. There is no fixed time frame by either side to finish these negotiations. “Gulf countries have made substantial Foreign Direct Investments (FDI) in India to the tune of US$20bn. The UAE and Saudi Arabia have respectively promised US$75bn and US$100bn of investments in India in different sectors,” Sayeed said.
“Indian companies have made substantial investments in West Asian countries. In many GCC countries, Indian companies are the largest in number other than the local companies – 6,000 in Oman, 700 in Saudi Arabia.”
GCC countries account for 70 per cent of gas imports
Sayeed informed that GCC countries account for almost 35 per cent of India’s oil imports and 70 per cent of gas imports. India’s overall crude oil imports from the GCC in 2021-22 was worth US$48bn. LNG and LPG imports in 2021-22 were about US$21bn.
“India’s energy partnership with GCC countries has evolved from a mere buyer-seller relationship into a more comprehensive partnership. Renewable energy is another important area of our bilateral cooperation with West Asia, particularly in the fields of green hydrogen and green ammonia. M/S ACME has signed a joint venture for a mega green hydrogen project in Oman. Three Indian companies have signed agreements with Egypt to develop green hydrogen by making substantial investments – Renew Power (US$8bn), ACME (US$6bn) and OCIOR Energy (formerly Azure Power – US$4bn),” he said.
With regard to the COVID-19 pandemic and the Russia-Ukraine conflict, Sayeed said the two events have brought to the fore issues related to supply chain and food, health, pharmaceuticals and fertiliser security. “In all these areas, particularly food security, there is immense scope for close cooperation between India and GCC countries.”
He said Gulf countries are interested in building mechanisms for making investments in India in the agriculture and food processing sectors for assured supplies that can address their food security concerns.
Learning from shared experiences
Sayeed noted that India has a lot to share with the world in its experience with digital public goods. “Our RuPay card and UPI platform are great examples in this regard. The RuPay card is accepted by UAE and we hope that other countries will also see its merit. The UPI platform can also be utilised by our partners for further enhancing trade and tourism,” he said.
“India’s defence and security relationship with the Gulf countries is continuously expanding, with high level visits, bilateral exercises, ship visits, training, and participation in exhibitions,” Sayeed added.
He noted that there are emerging common security perceptions, especially on tackling terrorism, which has created new opportunities for India-GCC cooperation in fields such as counter-terrorism, maritime security, intelligence sharing, cyber security and defence cooperation.
Oman to attend G20 summit
Sayeed also informed that this year is of great importance to India. “We are hosting the G20 for which Prime Minister Narendra Modi has given the motto ‘Vasudhaiva Kutumbakam’ or ‘One Earth, One Family, One Future.’
This is what I would request you to propagate through your channels. We are happy that besides Saudi Arabia, which is a G20 member country, UAE, Egypt and Oman will also be with us in the G20 meetings this year as special invitees,” he said.
“Additionally, to deal with issues related to climate change in a more pragmatic manner, we, as G20 president, will ensure close coordination with the UAE as it is hosting COP28 this year. We also congratulate Egypt for hosting COP27 at Sharm al Sheikh and for the success they achieved in setting the Loss and Damage Fund. India is also happy to participate in the Middle East Green Initiative launched by Saudi Arabia.”