Explained: Why the Gulf Matters to India

The BJP’s action against its own leaders underscores the importance of the Gulf region to India. With the exception of the Jewish state of Israel, the other 10 countries in the Gulf region – Saudi Arabia, Qatar, Iran, Iraq, Bahrain, Kuwait, United Arab Emirates, Oman, Jordan and Yemen – together account for one-fifth of the world’s Muslim population. , and are among the strongest voices in the Muslim world.

Why is the region important for India?

India has had good relations with countries like Iran for centuries, while Qatar, a small gas-rich country, is one of India’s closest allies in the region. India has good relations with most Gulf countries.

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The two main reasons for this relationship are oil and gas and trade. Two additional reasons are the large number of Indians working in the Gulf countries and the remittances they send home.

How much trade does India have with countries in this region?

According to the Indian Embassy in Riyadh, the Gulf Cooperation Council (GCC), which includes the United Arab Emirates, Bahrain, Saudi Arabia, Oman, Qatar and Kuwait, “has become a major trading partner of India” and has “vast potential as India’s investment partner”. for the future. The vast oil and gas reserves of the GCC are of utmost importance for India’s energy needs”.

United Arab Emirates: The United Arab Emirates was India’s third largest trading partner in 2021-2022, and the second largest for exports ($28 billion) and imports ($45 billion) when counted individually. In terms of total trade volume, the United Arab Emirates ($72.9 billion) was behind the United States ($1.19 trillion) and China ($1.15 trillion). The UAE accounted for 6.6% of India’s total exports and 7.3% of imports in the last fiscal year, up 68.4% from the previous year when international trade was hit by the pandemic.

Saudi Arabia: With a total volume of $42.9 billion in 2021-2022, Saudi Arabia was India’s fourth largest trading partner. While exports were low at $8.76 billion (2.07% of India’s total exports), imports from Saudi Arabia were fourth at $34.1 billion (7%) , up 50% on the previous year. Most of it was crude oil.

Iraq: It was India’s fifth largest trading partner in 2021-22 with $34.3 billion.

Qatar: Total trade was $15 billion, which is only 1.4% of India’s total trade, but the country is India’s largest supplier of natural gas. Vice President M Venkaiah Naidu, who is on a three-day visit to Qatar as the diplomatic row erupted over the weekend, said on Sunday that Qatar accounts for 41% of India’s total natural gas imports. The United Arab Emirates represents an additional 11%.

How much oil does India import?

According to an analysis by the Observer Research Foundation in April, more than 84% of India’s oil demand, which included crude oil and petroleum products, was met by imports. The 239 million tonnes of oil imports were worth $77 billion and accounted for almost a fifth of the country’s total imports last year.

India sourced crude oil from 42 countries in 2021-22, up from 27 countries in 2006-07, ORF noted. However, “India’s top 20 sources of oil imports have historically accounted for over 95% of India’s oil imports and the top 10 countries have accounted for over 80% over the past 15 years”, did he declare. “The share of Persian Gulf countries in India’s crude imports has remained at around 60% over the past 15 years.”

In 2021-2022, the largest oil exporter to India was Iraq, whose share rose from 9% in 2009-2010 to 22%. Saudi Arabia has accounted for 17-18% of India’s oil imports for more than a decade. Kuwait and the United Arab Emirates remain the major oil exporters to India. Iran was the second largest oil exporter to India in 2009-2010, its share fell to less than 1% in 2020-21, due to US sanctions.

How many Indians work in the Gulf and how much do they send money?

According to data from the Ministry of External Affairs, more than 13.46 million Indian citizens work abroad. If people of Indian descent (those who acquired citizenship of other countries and their descendants) are added, that number rises to more than 32 million.

Counting only the 13.4 million non-resident Indians (NRIs), the Gulf has the largest number. The United Arab Emirates (3.42 million), Saudi Arabia (2.6 million) and Kuwait (1.03 million) together account for more than half of all NRIs.

In terms of remittances from abroad, India was the biggest recipient in 2020 with $83.15 billion, according to World Bank data. That was nearly double the remittances to the second-highest recipient, Mexico, at $42.9 billion.

The biggest contributor is the huge Indian diaspora in the Gulf. In a November 2018 bulletin, its latest on the subject, the Reserve Bank of India said that GCC countries accounted for more than 50% of the total $69 billion in remittances received by India in 2016-2017. . The United Arab Emirates accounted for 26.9%, Saudi Arabia 11.6%, Qatar 6.4%, Kuwait 5.5% and Oman 3%. Beyond the GCC, remittances from the United States accounted for 22.9%, second only to the United Arab Emirates.

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What was the awareness of the Prime Minister in these countries?

Since coming to power in 2014, Prime Minister Narendra Modi has paid particular attention to maintaining or improving India’s relations with most countries in the region. At a rally in December 2019, Modi said, “Why is Modi getting so much support from Muslim countries?… Today, India has the best relations in its history with the Gulf countries. He said Palestine, Iran, Saudi Arabia, United Arab Emirates and Jordan had excellent relations with India and the Maldives and Bahrain awarded him their highest civilian honours.

Modi has visited the region several times since 2014. He visited the United Arab Emirates in 2015, 2018 and 2019, and the Crown Prince of Abu Dhabi visited India in 2017 and 2018. Modi visited Qatar and Iran in 2016, and Saudi Arabia in 2016 and 2019. In 2018, he visited Jordan, Palestine and Oman in addition to the United Arab Emirates, and became the first Indian Prime Minister to visit the Palestinian territory of Ramallah. He visited Bahrain in 2019.

There have been similar reciprocal visits by leaders of these countries over these eight years. Even during the pandemic, the leaders of India and the Gulf region have maintained regular contact, with Modi addressing the Crown Prince of Saudi Arabia, the Crown Prince of Abu Dhabi and the Emir of Qatar in March 2020, and to the Prime Minister of Kuwait and the King of Bahrain in April.

During his travels, Modi has also visited some of the most popular mosques in these countries, including the Sheikh Zayed Grand Mosque in Abu Dhabi in 2015 and the Sultan Qaboos Grand Mosque in Muscat in 2018.

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