India, six Gulf nations set stage to launch FTA talks

NEW DELHI: Amid a rush of trade deals with advanced countries, India signed the terms of reference (ToR) for negotiations with the six-member Gulf Cooperation Council (GCC) on Thursday, a step towards a free trade agreement (FTA), with the largest bloc trading with India.The ToR defines the scope, structure and modalities of negotiations for the proposed FTA. India already has a comprehensive economic agreement with the UAE and has also finalised one with Oman, which will be implemented in the next few months.GCC — comprising Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and UAE — is a key trade and investment partner for India, with exports of nearly $57 billion and imports of around $122 billion, accounting for over 15% of India’s total global trade.

Trade with GCC has grown at an average annual rate of about 15% in the last five years.

Commerce & industry minister Piyush Goyal said the agreement will build on the already strong ties and will open opportunities across food processing, infrastructure, petrochemicals, ICT and services for India. Visas for Indian workers and professionals along with investments may be a crucial elment of talks in the coming months.

India’s trade with UAE got a major boost after the bilateral trade deal was signed a few years ago.GCC chief negotiator Raja Al Marzouqi said the move sends a strong signal, amid global uncertainty. “It’s important for us at this time to try to be more cooperative to avoid any risk that our global economy is facing as a result of uncertainty,” he said. Ajay Bhadoo, additional secretary in the commerce ministry, will be India’s chief negotiator.Goyal said with the proposed trade treaty with GCC, India is seeking to build upon the recent pacts — from New Zealand to the UK, EU and the US — with others, such as Chile and Canada also in the pipeline. “In recent months, we have finalised FTAs that cover over 30 countries and all of them are complementary economies, with which India does not compete,” he said.He added that duty and non-tariff barrier elimination could boost farm and fisheries exports, support energy and food security, attract more investments and create jobs in both regions. India and GCC had begun FTA talks but the six-nation bloc suspended negotiations for all FTAs a few years ago. The proposal received a fresh lease of life after India signed the deal with UAE, but it was held up as all member countries were not on board.