Traditional, cultural and economic ties between the South Asian countries and the Gulf region have existed for several centuries now. While the Gulf region has to offer substantial economic advantages to both the major powers of South Asia; Pakistan and India, it also has the potential to make positive interventions in the bilateral conflict between India and Pakistan.
Under its “Look West Policy”, India has consistently strategized its foreign policy footprint towards the Middle East and adopted an approach to achieve its objectives. Frequent state-level bilateral visits and extensive economic cooperation has harmonized Indo-Arab thinking to cooperate in the areas of trade and investment, defence, and security related issues. Pakistan, on the other hand, has strong religious, historical, political, trade and security links with the Gulf region. Furthermore, Pakistan’s recent decisions on the foreign policy front such as supporting Iran’s nuclear deal; neutrality in the Qatar diplomatic crisis; and declining Saudi Arabia’s request for troops in Yemen war have provided impetus to India-GCC countries cooperation, compelling the Gulf leadership to think beyond Pakistan for their interests.
The Gulf Cooperation Council (GCC) has tremendous significance for India. India has its stake in the geo-politics of the Gulf region. As a collective entity, the GCC has been increasingly determining the economic, political, and security policies of its member States and the Gulf countries are moving ahead rapidly with their economic integration efforts. India’s historical ties with GCC states, coupled with increasing imports of oil and gas, growing trade and investment opportunities, providing a large market to the GCC exports and the presence of a large Indian diaspora in the region, are of vital interest to India. India’s economic linkages with the GCC steadily increased during 1970s, 80s and 90s, especially due to growth in oil imports. As it is clearly claimed that a pattern of interdependence and coordination is emerging between India and the GCC due to their central role in the current political and strategic discourse.
Currently, the Gulf region accounts for 12.98% of India’s total exports, while it shares 13.76% of its total imports. During 2020-21, India’s exports to GCC were USD 28.06 billion. The bilateral trade during the same period was USD 87.36 billion. The trade increased to USD 84.96 billion in 2017-18, from USD 7.8 billion during 2003-04. UAE and Saudi Arabia are the largest shareholders of total imports to India from the Gulf region. The key economic alliances between both the states provide for deepening the economic cooperation to oversee the implementation of the pact and other bilateral agreements. Both sides have strategized to make arrangements for setting up joint investment projects and facilitating corporate investments in various fields.
It is also noteworthy that one of India’s major foreign policies in the post-Cold War era has been to counter a rising China. Both are attempting to create their respective spheres of influence in the Gulf region. India projects Chinese rise in the Gulf region a challenge to its economic and strategic interests since it can impact India’s economic share in the region. With regards to it, the trade between China and GCC countries exceeded USD 171 billion in 2017. Moreover, China is also pursuing the Gulf region for signing Free Trade Agreements. In this regard, the GCC-China Business Forum and GCC-China Strategic Dialogue are strategic forums for institutionalization of bilateral trade and investment. With this, it is more likely that Indian economic interests will be affected since each is competing for cheaper oil agreements and export of non-oil goods such as labor-intensive goods like textile, iron, steel, rice, wheat, kitchen items, household articles, and electronics. Indian strategists also trying to present China as a challenge to their energy and maritime security. This is apparent from the Indian Maritime Doctrine of 2004 and Indi’s Maritime Strategy of 2015 that highlight Beijing as a major security threat to India’s maritime security. Therefore, the Indian Navy has been extensively engaging with naval forces of Arab countries through regular exercises in order to ensure its active presence in the region. Hence, China has been presented as another motivating factor behind India’s evolving relationship with the Gulf.
While the economic relationship between India and the Arab Gulf states goes back several centuries, the nature of the political relationship has changed significantly over the years. When it came to regional politics, Pakistan was consistently favored over India. Gulf States support Islamabad in its wars against Indian offense and backed Pakistan’s stance over Kashmir. Moreover, Pakistan enjoys special and cordial relations with all of the Gulf countries, formalized through bilateral and multilateral cooperation on trade, security and economic development. It also benefits through remittances coming from its diaspora in the Gulf and also through the Gulf investment towards development in Pakistan, mainly in telecommunication, construction, agriculture and energy sectors. Owing to its significance of being the holiest place for Muslims around the world, Saudi Arabia occupies a very sacred place in the hearts of millions in Pakistan. Over the decades, Saudi Arabia has also been providing support to Pakistan and has welcomed thousands of Pakistani workers into its labor force.
Considering geographical proximity and religion as the key factors, the expertise and services of Pakistan’s armed forces have been of considerable demand in the Gulf. Security cooperation between Pakistan and the Gulf got impetus when Pakistan sent more than 11,000 troops to secure Saudi Arabia, during the war against Iraq (1991-92). In 1983, emphasizing the Kingdom’s internal defence, Saudi Arabia signed two security cooperation agreements with Pakistan. In the early 80s, hundreds of Pakistani officers and technicians were serving in warships and naval establishments in GCC states, Pakistani instructors were also prominent at the new Saudi naval school in Jubail, open to all six GCC states. Since then, this relationship has been strengthened as Pakistan opened doors of its military academies to security personnel from the Gulf countries.
The dynamics of the relationship between India and the Arab Gulf States have changed over the years and have gradually entered an era of cooperation. The relationship has emerged from its traditional trade-oriented focus to an all-round politico-strategic partnership. India’s growing economic and defence expertise is further attracting the GCC investment and collaboration. Along with India, the Arab Gulf states have a strong economic, political and cultural link with Pakistan. Thus, there appears to be a convergence of interests between India and Pakistan in establishing a close partnership with the GCC. In striving for cooperation, it is also reality that the Gulf States have acted as a buffer between India and Pakistan.
The GCC countries have in the past expressed concern over the hostility between India and Pakistan and have urged the two countries to resolve the conflict amicably. Historically, in 1999, at the height of the Kargil conflict between India and Pakistan, the GCC foreign ministers issued a joint statement calling for peace, “GCC called on the two neighboring countries to resort to reason and prudence in solving the problems between them by peaceful means, avoiding force and the inevitable human and material losses for both sides.” The statement reflected appreciation of Pakistan’s principled position and called on the UN to intervene and end the fighting by enhancing UN Military observer force in Kashmir. Moreover, in the recent past, Saudi Arabia played a decisive role in reducing hostility between the two nuclear powers in the post-Pulwama period.
Due to geopolitical shifts in the Middle East and South Asia, Pakistan and the GCC states are investing heavily in their defence sector. Pakistan is striving to achieve indigenization and improve sales of small and heavy artilleries. It can be done by seeking GCC’s investment in its armament programs and joint research and development (R&D) in military hardware. Pakistan should invite other GCC states to invest in the China-Pakistan Economic Corridor (CPEC). This will help the government in not only meeting the shortfall in investment, but will also deflect international pressure on the project. Therefore, by revitalizing trade with all the GCC countries, improving and expanding the system of remittances while maintaining neutrality on all fronts, Pakistan can provide an alternate to the Gulf markets. Doing so will also help steer Pakistan’s economy during the turbulent times and generate immense economic benefits out of the Gulf region.