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GCC and India agree to resume free trade talks

Rueters/Jayanta Dey
Mutually agreed areas of focus in the free trade agreement talks include food security, energy security and technology transfers

India and the Gulf Cooperation Council (GCC) have agreed to resume talks on a free trade agreement, India’s trade minister Piyush Goyal said, as his nation seeks closer ties with one of its largest trading partners.

The talks mark the third such attempt by India and the GCC to ink a trade pact, with negotiations previously held in 2006 and 2008.

GCC secretary general Nayef Falah M Al-Hajraf said that mutually agreed areas of focus in the talks would be food security, energy security and technology transfers, among others.

“The free trade agreement will be a comprehensive economic partnership that will cover different aspects of trade and will also look at certain aspects related to investment promotion,” Goyal said, adding the two sides hoped to strike a deal “at the earliest” opportunity.

Bilateral talks will be held on a trade mechanism involving the Indian rupee and local Gulf currencies, the minister added.

The GCC is India’s largest trading partner, Goyal said, with bilateral merchandise trade in 2021-22 standing at $154 billion and services trade at $14 billion.

He added that GCC countries contribute almost 35 percent of India’s oil imports and 70 percent of gas imports.

Earlier this year India signed a comprehensive economic partnership agreement with the UAE to help Indian exporters tap into the Gulf Arab state – which acts as a trading hub – for further access into markets in Africa and Europe.

New Delhi’s Ministry of Commerce reported earlier that exports to the UAE, excluding petroleum products, grew to $5.92 billion in June to August 2022, from $5.17 billion in the same period in 2021 – an increase of 14 percent.

Indian non-oil imports from the UAE for the same period nudged up from $5.56 billion in June to August 2021 to $5.61 billion this year, an increase of just one percent.

Trade volumes between India and the UAE are projected to reach $100 billion by 2030.