The Gulf Cooperation Council (GCC) has announced its intention to begin long-awaited free trade agreement (FTA) negotiations with India this year, a move that could redefine economic ties between the two regions. The announcement was made during the Kochi Dialogue, a major diplomacy conclave held in Kerala on January 16-17, 2025, themed “India’s Look West Policy in Action: People, Prosperity, and Progress.” The event was jointly organized by the Indian Ministry of External Affairs and the Centre for Public Policy Research think tank and attracted high-profile delegates from GCC member states—Oman, Kuwait, Bahrain, Qatar, Saudi Arabia, and the UAE—as well as representatives from Australia, Malaysia, and Sri Lanka.
GCC Secretary-General Jasem Mohamed Al-Budaiwi, a keynote speaker at the event, highlighted the immense potential of strengthening economic ties between the Gulf nations and India. He described the FTA as a crucial step toward economic integration, removing trade barriers, boosting cooperation in digital economies, and transforming industries. Expressing optimism, he said he hoped the first round of negotiations would commence in 2025.
Trade between India and the GCC is already substantial, with exchanges valued at over $160 billion in the past year. GCC exports to India accounted for $90 billion of this total, representing 71 percent of the bloc’s overall exports. This robust economic partnership is complemented by the GCC’s investment in India, which exceeds $5.7 billion across various projects, driving job creation and economic growth. Al-Budaiwi underscored these investments as reflective of the strong and mutually beneficial relationship between the two sides.
India has pursued a free trade pact with the GCC for nearly two decades. While a Framework Agreement on Economic Cooperation was signed in 2004, earlier negotiation rounds in 2006 and 2008 failed to yield results. To date, India has an FTA with only one GCC member, the UAE, through the Comprehensive Economic Partnership Agreement signed in 2022. Expanding this agreement to include the entire GCC would provide India access to a vast, affluent market and potentially offer visa concessions for Indian expatriates, a vital aspect given that nearly nine million Indians live and work in the Gulf region.
The announcement marks a significant step in advancing India’s Look West policy, which aims to deepen ties with the Middle East and enhance regional cooperation. As both sides prepare to initiate negotiations, the proposed agreement is poised to unlock new avenues for trade and innovation while fostering closer diplomatic and cultural relations. The success of this endeavor could reshape the economic landscape for India and the GCC, heralding a new era of collaboration and shared prosperity.
