India exploring to use Arab World FTAs ​​with US and EU for exports

NEW DELHI: India has made efforts to build Indo-Arab economic partnership, in proportion to the strategic partnership between the two sides and exploring opportunities to use Arab World FTA with US and EU for Indian businesses.

India-Arab relations are based on strong traditional ties and deepening political understanding. Our economic relations need to be raised to a higher level to match the strategic partnership and the strong momentum in bilateral understanding at the political level. There is great potential in growing Arab economies as many Arab countries have FTAs ​​with the EU and US Arab countries and Indian businesses can both benefit from participating in economic growth and development, said MEA Secretary (CPV & OIA) Sanjay Bhattacharyya for FICCI in a speech entitled India’s Engagement with the Arab World on Tuesday.

He listed the key elements of future efforts between India and the Arab World. First, Aatmanirbhar Bharat offers a vision of India’s plans to become a $ 5 trillion economy by promoting Make in India – Make for World through integration with the global economy. The field in the future will be in joint ventures in infrastructure and manufacturing, eavesdropping on the Arab Sovereign Wealth Funds and integrating into supply chains, Bhattacharyya said, adding, Another focus will be on innovation and start-ups, such that entrepreneurial collaborations are future-oriented. The success of Indian start-ups in IT, e-commerce, hospitality, logistics and others can affect the higher growth of India-Arab economic ties.

He suggested that New Emerging Technologies, especially in ICT, consulting, fin technology, logistics, edutech, healthtech and others have great potential. These will promote efficiency and increase growth and development in the future. Further, collaboration between Centers of Excellence on the Industrial Revolution 4.0 will stimulate continued growth. In some ways, we need to transform a segment of our economic interaction into a “forward curve partnership focused on technology collaboration, R&D, and high-capital projects that drive future-oriented growth.”

High-tech collaboration, especially in defense and space has the potential to grow. We have cooperation agreements in both sectors with most of the Arab countries. With the increase of private sector participation in these areas, the potential for cooperation is much higher. In the defense sector, we can expand the export of equipment and armaments. In the space sector, there is potential for training, launching satellites, sharing satellite data, etc., the senior diplomat recommended.

Indian business can explore ventures in less explored markets, which can yield large dividends. The current focus of Indian business is on trade, investment and technology exchanges with GCC, Egypt and Israel, which are the largest economies. While these may be further expanded, there is great untapped potential in other countries, for example, Iraq (hydrocarbons, construction, medical), Syria (construction, medicine, education), Algeria (construction, defense), Morocco ( manufacturing, FMCG, tourism), Jordan (mining, tourism), Sudan (energy, mining, medicine).

High-level exchanges between India and the Arab world have fostered deeper understanding and cooperation. This is a good time for the business community to develop deeper connections, based on each other’s national priorities and development plans. Cultural exchanges will promote goodwill between people and facilitate economic engagement, Bhattacharyya said, adding, With both India and the Arab region involved in reforms and transformational changes in the economy, strong political understanding and goodwill among peoples offers tremendous potential to take the engagement to a higher level.

He noted that the Arab region is part of India’s expanded neighborhood. Just as we had a particular priority for the East, today we have it for the Arab world in our Look / Act West policy, reflecting our priority and intimacy.

One can broadly divide the 22 Arab countries and Israel into 3 groups in the north of the Gulf, we have Arab partners with whom we have traditional ties, but this region today is facing conflict; the Gulf region, where we have a strategic partnership which is politically stable and economically prosperous; the African region along the Mediterranean with which we have deep ties, which enjoys relative stability and moderate prosperity. In a sense, the region from Oman, to the Arabian Sea, to Morocco, to the Atlantic coast, has common features and offers great opportunities.

Referring to diplomacy Covid Bhattacharyya said, With the Arab world, we cooperated on the repatriation of stranded citizens, in both directions. The Vande Bharat Mission, the largest repatriation exercise, has been possible due to the active support of our Arab partners. We are happy that the return of Indian workers and professionals to the Gulf region has now begun. With the return of PR to their families and the return to the Gulf of professionals in healthcare, data management, the oil and construction sectors and even sports professionals, the future of our collaboration in human resources looks bright.

India provided emergency medical supplies to several Arab countries, emerging as the first humanitarian aid provider for Covid. The Indian medical team went to Kuwait and medical and humanitarian supplies arrived in Lebanon shortly after the tragic explosion in the port of Beirut. Further, India was able to secure, during the pandemic, thousands of healthcare professionals from Saudi Arabia and hundreds from Kuwait, Bahrain and the UAE to help them address the Covid challenge. The two sides also cooperated in the research and testing of Covid. We are ready to support the availability of vaccines from India, as we will be the largest producers, once the vaccine is ready, informed Bhattacharyya.

Strong multilateral exchanges characterize the nature of India’s engagement with the Arab region. As it is the extended neighborhood of Delhi, it has several strategic partnerships and has a positive momentum in its relations with all Arab countries. Importantly, these relationships are independent of relationships with others and are not affected by their internal changes.

For energy security, 53% of oil imports to India and 41% of gas imports come from the region. India has stakes in oil blocs in Iraq, Syria, Libya, the United Arab Emirates, Yemen and South Sudan. The nature of the partnership has evolved from simple hydrocarbon links between buyer and seller to participation in upstream and downstream projects, joint ventures in refineries and the construction of strategic oil reserves.

For food security, India remains the reliable and long-term reliable source of food exports to the Gulf, with growing links to the rest of the Arab world. The partnership has become stronger with the connection, the creation of joint ventures and the cooperation along the value chain. At the same time, India sources 60% of fertilizers and raw material imports from the Arab world, which deepens our mutual relations.

Human resource exchanges are a key element of India’s bilateral cooperation with the Arab world, especially in the Gulf. Indians are the largest migrant community in the Arab world with 9 million workers and professionals (30% of the entire migrant workforce). Indian emigrants send about $ 48 billion to India from the Arab world.

Investments from the Arab region are $ 7 billion in FDI capital inflows from 2000-18, approximately 2% of total FDI. However, growth in recent years has been promising and the share of sovereign wealth funds and portfolio investments is seeing a positive trend. The main investment sectors are energy, metallurgical industries, real estate and construction, services and IT. India’s total trade with the Arab world of $ 162 billion makes it a major trading partner. Although hydrocarbons make up the bulk of trade, the basket has diversified in recent years to include engineering goods, jewelery and jewelery, precious metals, foodstuffs, textiles and chemicals in our exports and gold and other products in imports.