India�s Growing Strategic Relationship with the Gulf

Recent years have witnessed a phenomenal rise in interaction between India and the Gulf and exchange visits of high dignitaries. This indicates that India’s relation with the Gulf countries has improved, though complexities in their ties remain due to multiple factors, including the changing regional dynamics and external pressures. Prime Minister Manmohan Singh’s two-nation visit to the Gulf in November 2008 was significant in many ways. It was an attempt to expand India’s relation with the West Asian countries and increase its presence in the region. The Manmohan Singh government has adopted a proactive Gulf policy, a region that was previously overlooked by governments in New Delhi. In January 2009, India’s Minister of State for External Affairs E. Ahmad called for multi-faceted cooperation with Gulf countries. India has vast economic, commercial, energy, strategic, and security interests in the Gulf because of its geo-strategic location and vast energy resources. China has political, strategic, and trade interests in the region and has made inroads by signing economic, commercial, energy, political, and strategic agreements with countries. India and the Arab League have signed an agreement on December 2, 2008 for the establishment of an India-Arab Cooperation Forum similar to the China-Arab Cooperation Forum established in January 2004.
 

E. Ahmad stressed on January 16, 2009 the close relationship between India and the Gulf because of their common political and security concerns. Saudi Arabia’s Foreign Minister Prince Saud Al-Faisal visited India in February 2008. In return, India’s External Affairs Minister Pranab Mukherjee visited Saudi Arabia on April 19, 2008 and met King Abdullah. Iran’s President Ahmadinejad made an ‘official stop-over visit’ to India on April 29, 2008 and discussed various issues with the Indian leadership. India’s relations with the UAE, Bahrain, and Kuwait have substantially improved.
 

India needs an active Gulf policy because of its growing energy demand and the large number of Indian expatriates working there. India imports around two-third of its total requirement of oil. Around 5 million Indian workers (skilled, semi-skilled, and un-skilled) are working in the Gulf and India get remittances worth US $ 7-8 billion every year. The recent global economic recession has caused a decline in oil prices that had reached US $ 147 p/b on July 11, 2008 and fell sharply to US $ 34 p/b in February 2009.  Low oil prices, as a result of global economic recession, have adversely affected the Gulf since its economy depends on energy exports. If the Gulf economic crisis deepens, India faces a double problem of declining remittances on one hand, and jobless returnees flooding the domestic market on the other.
 

Manmohan Singh’s three-day visit on November 8-10, 2008 to Oman and Qatar and signing of agreements relating to economic, energy, defence and security is an important step in the changing regional dynamics. India has also concluded agreements with other countries in the Gulf. Prime Minister Manmohan Singh said that the Gulf is an area of great importance to India, “it (the Gulf) is part our extended neighbourhood and home to five million Indians. It is the largest source of our energy supplies. We have active trade and investment interests.” In an interview to the Oman Tribune and the Arabic daily Al Watan, he said that India would play a political, economic, and strategic role that all Gulf countries were comfortable with in maintaining regional security in the Arabian Gulf. On India’s ties specifically with Oman, he pointed out that the ties between the two countries are closely rooted in centuries of interaction. India and Oman signed an MoU to set up an India-Oman Joint Investment Fund with a seed capital of $ 100 million, which will be expandable to $ 1.5 billion. The fund will identify projects in infrastructure, health, tourism, telecom, utility, and urban infrastructure in both countries. The two countries also signed an MoU in the field of manpower to boost recruitment of Indian professionals in various sectors in Oman and to prevent illegal recruitment and human trafficking. India has been contemplating a Free Trade Agreement (FTA) with the Gulf countries. Oman was the first country that proposed the FTA between the Gulf and India. The FTA will essentially include three areas – goods, investments, and services.
 

The growing piracy in the seas and terrorism are serious problems for the Gulf countries and India. Manmohan Singh stated “piracy, criminal activities and terrorism on our land and seas threaten the Gulf countries and India as well.” This comment came in the wake of a number of ships, including Indian, being hijacked by Somalian pirates in the Gulf of Aden in recent times.
 

As part of the Gulf visit, Manmohan Singh arrived in Qatar from Oman and held extensive talks with Prime Minister HE Sheikh Hamad bin Jassim bin Jabor al-Thani to enhance exiting ties in the fields of energy, economy, and trade.  His visit to Qatar culminated in the singing of defence and security cooperation agreement that lays the framework for collaboration on maritime security, sharing of intelligence and information on extremist threats, money laundering, and smuggling of narcotics. The pact on defence cooperation lays out a structure for training programmes by the two sides and exchange of goodwill missions and experts.
 

India annually imports 7.5 million tons of liquefied natural gas (LNG) from Qatar. It has sought an additional five million tons of liquefied natural gas to meet its growing energy needs and has proposed to set up a gas-fired fertiliser plant there to meet its urea requirements. The two countries focused on how to upgrade the energy deal from a buyer-seller relationship to a more sustainable one involving investments and a long-term partnership. At Qatar and earlier in Oman, Manmohan Singh sought funds for investment in infrastructure sector to boost economic growth that is slowing down due to the global financial crisis.
 

The pattern of interaction between India and the Gulf illustrates that India’s ties with the region has been growing. Visits of high dignitaries and bilateral agreements are indicative of this. The expansion of India’s ties with the Gulf would have a positive impact on trade and security and for neutralising/balancing China’s growing influence in the region.

(Diclaimer: The views expressed in this article are those of the author and do not represent the views eihter of the Editorial Comittee or the Centre for Land Warfare Studies)