The Making of a Friendship
The relationship between India and Saudi Arabia rests on centuries of economic and socio-cultural ties – dating back to the ancient era when trade between the two comprised largely of spices, aromatics, almonds and dates. The two have come a long way since. Today, Saudi Arabia is a major supplier of energy for India, providing around 19% of India’s crude oil requirement. As per figures provided by the Directorate General of Foreign Trade, the current bilateral trade between the two countries is pegged at $26.71 billion.
The Kingdom is the eighth largest market in the world for India and is a destination to more than 2.44% of India’s global exports. On the other hand, Saudi Arabia is the source of 5.34% of India’s global imports. For Saudi Arabia, as per 2015 data, India is the fourth largest market, accounting for 9.43% of its global exports. In terms of imports by Saudi Arabia, India ranks seventh and is source of around 3.43% of Saudi Arabia’s total imports.
The private sectors in the respective countries are actively engaged by way of investments. Saudi Arabian General Investment Authority (SAGIA) has issued 426 licenses to Indian companies for joint ventures/100% owned entities till April 2015, ushering in an estimated investment of $1.6 billion in Saudi Arabia. Several Indian companies have established collaborations with Saudi companies and are working in the Kingdom in the areas of designing, consultancy, financial services and software development. On the other hand, as per available data, Saudi Arabia is the 48th biggest investor in India with investments from April 2000 to March 2016 amounting to $64.19 million.
It is mention worthy that Saudi Petrochemical joint SABIC had set up its R&D Centre in Bangalore with an investment of over $100 million in November 2013. During PM Narendra Modi’s visit in 2016, a framework for Investment Promotion Cooperation between Invest India and Saudi Arabian General Investment Authority (SAGIA) was signed to further facilitate investments by the private sector in the two countries. The bilateral institutional mechanisms in the field of trade & investment, energy, defence and manpower between the two countries is also functioning well. And there is a constant endeavour to explore potential areas of cooperation such as in the areas of renewable energy, ICT, space technology, sustainable development, arid agriculture, desert ecology, urban development, healthcare and biotechnology, food security etc.
The civilizational ties between the two countries have been enriched by the movement of not only goods, but people and ideas as well. Currently, there are more than three million Indians living in Saudi Arabia, forming the largest expatriate community in the Kingdom. The community is also the ‘most preferred’ due to its expertise, sense of discipline, law abiding and peace-loving nature. An agreement has been signed on labour cooperation for recruitment of General Category Workers and a Joint Working Group has been established to attend to consular issues on a regular basis. The contribution made by the Indian community to the development of Saudi Arabia over the decades is also well acknowledged by the Saudi Arabians.
Religion also bonds the two countries closely. Last year around 1, 36,000 Indians visited the Kingdom to perform Haj in the two Holy cities of Makkah and Madinah. The annual quota of Haj pilgrims from India has been increased by 34,500, the biggest increase since 1988! A fairly large number visit Saudi Arabia to perform Umrah as well.
The ties between the two countries have gradually strengthened since establishment of diplomatic relations in 1947. High-level visits from both sides have been highly instrumental towards this end. King Saud visited India in 1955 and was reciprocated the following year by Prime Minister Jawaharlal Nehru’s visit to the Kingdom. Prime Minister Indira Gandhi’s visit to Saudi Arabia in 1982 gave a further boost to bilateral relations between the two countries. More recently, in 2006, King Abdullah visited India as the Chief Guest of Republic Day celebrations. The visit was historic indeed as it led to the signing of ‘Delhi Declaration’, first such bilateral document ever signed by a Saudi King which provided a comprehensive roadmap for the bilateral relations. It was during this visit that King Abdullah referred to India as his “second home”. The visit provided the framework for cooperation in all fields of mutual interest. The reciprocal visit by Prime Minister Dr. Manmohan Singh to Saudi Arabia in 2010 raised the level of bilateral engagement to ‘Strategic Partnership’ and the ‘Riyadh Declaration’ signed during the visit captured the spirit of enhanced cooperation in political, economic, security and defence realms.
In February 2014, during the visit of Crown Prince Salman Bin Abdulaziz Al-Saud, a Joint Statement was issued. A MoU on Defence Cooperation signed at the time served as an important milestone in strengthening the strategic partnership between the two countries. The leaders of both the nations are agreeable on the need to further intensify bilateral defence cooperation, through exchange of visits by military personnel and experts, conduct of joint military exercises, and supply of arms & ammunition and their joint development.
And just last year, in 2016, Prime Minister Narendra Modi visited the Kingdom. The visit can be seen as a turning point in India’s growing engagement with the Kingdom of Saudi Arabia, giving an upward strategic direction to the ties. The Custodian of the Two Holy Mosques King Salman bin Abdulaziz extended a warm welcome and honoured PM Modi with the ‘Sash of King Abdulaziz’, the highest civilian decoration awarded by the Kingdom. He commended Prime Minister Modi’s initiatives of ‘Start Up India’, ‘Make in India’, ‘Smart City’, and ‘Clean India’, as strong enablers for the growth of the economy.
The two leaders agreed to enhance cooperation to strengthen maritime security in the Gulf and the Indian Ocean regions. They further agreed to promote bilateral collaboration for humanitarian assistance and evacuation in natural disasters and conflict situations. They also expressed strong condemnation of terrorism and combating it; besides cooperating in counter-terrorism operations both at the bilateral level and within the multilateral system of the UN. They called upon the international community to strengthen multilateral regimes to effectively address the challenges posed by terrorism. The two sides agreed to work together towards the adoption of India’s proposed Comprehensive Convention on International Terrorism in the United Nations.
The Kingdom’s initiative in bringing together Islamic Alliance against terrorism was also lauded by the Indian PM and a MoU was signed on cooperation in exchange of intelligence related to money laundering, related crimes and terrorism financing. The Saudi side expressed its interest in investing in infrastructure development in India, especially in priority areas such as railways, roads, ports, and shipping. It also welcomed interest of Indian side in investing in the Kingdom, especially taking advantage of the competitive investment opportunities offered by the Saudi economic and Industrial cities.
The visit enriched the bilateral relations between the two countries in the political, economic, security, defence, manpower and people-to-people exchanges. Several regional and multilateral issues of mutual interest were discussed and co-operation underlined. For instance, cyber security, cooperation between educational institutions, universities and higher research institutions of the two countries etc.
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