India and the Gulf Cooperation Council (GCC) have agreed to pursue a free trade agreement (FTA) between the two regions and resume negotiations.
The Gulf Cooperation Council (GCC) is a regional political and economic alliance of six countries in the Gulf region - Saudi Arabia, the UAE, Qatar, Kuwait, Oman and Bahrain.
Head-quartered in Riyadh, Saudi Arabia, the GCC was established by an agreement concluded in 1981 in Riyadh.
Its aim is to achieve ever closer union between the energy rich Gulf countries.
The GCC is the largest trading bloc of India.
According to data from the Commerce Ministry of India, India's exports to the GCC countries grew by 58.26% to about $44 billion in 2021-22 against $27.8 billion in 2020-21.
Bilateral trade in goods has increased to $154.73 billion in 2021-22 from $87.4 billion in 2020-21.
Services trade between the two regions was valued at around $14 billion in 2021-22, with exports at $5.5 billion and imports at $8.3 billion.
Oil - GCC countries contribute almost 35% of India's oil imports and 70% of its gas imports.
India's overall crude oil imports from the GCC in 2021-22 were about $48 billion, while LNG and LPG imports in 2021-22 stood at about $21 billion.
In 2004, India and GCC signed a Framework Agreement for enhancing and developing economic cooperation between the two sides.
Two rounds of talks (2006 and 2008) for finalizing aspects like tariff rules, rules of origin, etc have been held.
But these were stopped because of some reasons. So, the current negotiation for India-GCC FTA is a significant move.
Similar to this FTA, India is also negotiating a trade agreement with Australia. To know more about the India-Australia ECTA, click here.
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