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India and Gulf Cooperation Council:Time to Look Beyond BusinessPrasanta Kumar PradhanPublished online: 11 May 2010.

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Strategic AnalysisVol. 34, No. 3, May 2010, 409–419

ISSN 0970-0161 print/ISSN 1754-0054 online© 2010 Institute for Defence Studies and AnalysesDOI: 10.1080/09700161003659103http://www.informaworld.com

RSAN0970-01611754-0054Strategic Analysis, Vol. 34, No. 3, March 2010: pp. 0–0Strategic AnalysisIndia and Gulf Cooperation Council: Time to Look Beyond BusinessStrategic AnalysisPrasanta Kumar Pradhan Prasanta Kumar Pradhan

Abstract: India’s relationship with the Gulf Cooperation Council (GCC) has beenprimarily based on mutual trade and business. GCC countries are the main source ofenergy for India and a market for Indian commodities. India’s five-million-strongworkforce forms a natural linkage between India and the GCC. But despite such strongtrade linkages, which are still growing, political and strategic relations between Indiaand the GCC have been found lacking. Recent years have witnessed signing of defenceand security agreements between India and some of the GCC countries. But there stillremain some irritants in the relationship, which need to be addressed by both sides. Theemerging security and regional and international order in the region demands increasedinteraction between India and the GCC. As the GCC is also opening up, this paperargues that it is time for India to look beyond trade and business, and engage the GCCin political, security and strategic fields.

Introductionhe relationship between India and the Gulf Cooperation Council (GCC)1 hasgrown since the formation of the organisation in 1981. For India, its relationship

with the GCC represents its varied interests in the economic, strategic and politicalfields. In recent times, both India and the GCC have been looking for new areas ofcooperation and are trying to improve their relationship. Although there have been anumber of irritants, the interests of both the parties have kept the relationship going ata steady pace.

In the past, India’s relationship with the Gulf countries has been based onmutual trade and business, and this continues to grow. The Gulf region is the mainsource of India’s energy needs, meeting around two-thirds of its total energyrequirements. Similarly, the Gulf region has been a lucrative market for Indianmanufactured goods like textiles, spices, food products, and lately, electrical goodsand machineries, and information technology products. The bilateral trade betweenIndia and the GCC is currently around $28 billion and is expected to touch $40 bil-lion by the year 2010. But despite having such a huge trade and business relation-ship, the political relationship between India and the GCC has not been so warm. Inthis context, this paper attempts to analyse the current state of the relationship, iden-tify the hurdles, and argue that India and GCC should look beyond mere trade andbusiness; and try to make it a more meaningful and durable relationship. There is anurgent need to improve the bilateral political relationship and to enter into a mutu-ally beneficial strategic partnership.

Prasanta Kumar Pradhan is an Associate Fellow at IDSA.

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410 Prasanta Kumar Pradhan

Economic relations: the mainstay of the relationshipEconomic relations have been the backbone of India–GCC ties with trade and businessgrowing steadily. The growth in the volume of trade can be gauged from the fact thatIndia’s total trade with the GCC countries rose from US$5.55 billion in 2000/01 toUS$23.42 billion in 2005/06. The period witnessed resilience in both exports andimports.2 According to the Department of Commerce, Government of India, the totaltrade between India and the GCC countries for the years 2008–2009 stands atUS$91.63 billion with total imports of US$59.5 billion and total exports of US$32.13billion.3 The GCC countries continue to be the major supplier of oil and gas to India,meeting almost two-thirds of its requirements.

The first GCC–India Industrial Conference was held in Mumbai in February 2004,which was attended by GCC Secretary General Abdulrahman bin Hamad Al Attiyahand industry ministers of all GCC countries. The leaders discussed ways and means topromote economic cooperation between India and the GCC. The conference focusedon trade, investment, industrial and technological cooperation and issued a ‘MumbaiDeclaration’.4 Further, in August 2004, India and the GCC signed a frameworkAgreement on Economic Cooperation to explore the possibility of a free trade agreementbetween them. Later, in November of same year, a three-member GCC negotiatingteam visited India and held discussions on a broad range of issues, including the pos-sibility of initiating negotiations towards a free trade agreement (FTA) and non-tariffbarriers affecting Indian exports to the region.5 The second conference was held inOman in March 2006. The third conference in May 2007 decided to facilitate andexpedite projects in the field of agriculture and food processing, which was identifiedas a new sector with significant opportunities for trade and investment. The GCC statesagreed to receive and facilitate the visits of Indian agro-processing companies, andIndia was to reciprocate.6

In order to, get closer with the Gulf countries, the Government of India adopted a‘Look West’ policy in the year 2005, in line with the successful ‘Look East’ policy.While announcing the new policy, Prime Minister Manmohan Singh said that ‘theGulf region, like South-East and South Asia, is part of our natural economic hinter-land … We must come closer to our western neighbours in the Gulf’. He authorisedthe Commerce and External Affairs Ministries to begin negotiations with the GCC toconclude a FTA, and also approved negotiations with all individual member countriesof the GCC for a comprehensive economic cooperation agreement covering the servicessector and investment.7

India’s five-million-strong workforce in the GCC countries is also an importantlink between the two regions. In fact, expatriate workers from India constitute thelargest workforce in the region. The GCC countries host over 95 per cent of aboutfour million Indian workers in the West Asian and North African region, and remit-tances by them have helped India to raise its foreign exchange reserves. Like India,the GCC countries also benefit from such migrations. These benefits are derived fromthe fact that Indian migrants are generally hard working, sincere, efficient, low paidand law abiding.8

Political relations: need to improveAlthough India and the GCC enjoy mutually beneficial trade and business relations,these are yet to be reflected on the political front. India has initiated a few steps to

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engage the GCC countries politically and strategically in a more rigorous manner. AGCC–India political dialogue was initiated in the year 2003 to boost interactionbetween the two parties. In this regard, the fourth India–GCC Political Dialogue washeld in New York in 2008 on the sidelines of the 63rd session of the UN GeneralAssembly. From the Indian side, the meeting was attended by External Affairs MinisterPranab Mukherjee. The two sides discussed the state of India–GCC relations and thesituation in the West Asia, particularly the peace process between Israel and Palestine,and the situation in Iraq.

The volatile security situation and the precarious strategic environment in the Gulfhave dictated the GCC countries to adopt a ‘Look East’ policy to give priority to theirAsian neighbours. The GCC countries are also looking towards Asia because theyfind that the suspicion and scrutiny that greets Arabs in the West is increasingly anobstacle to do business.9 They are diversifying their engagements with the Asiancountries, and India certainly figures largely in their new-found policy. India has beengranted the status of a ‘dialogue partner’ by the GCC. India is the first country fromthe developing world and only the fourth country after the United States, the Euro-pean Union and Japan to have got this privilege.10

The steady progress of the Indian economy, its stable democratic political struc-ture, its technological developments and its increasing demand for energy are some ofthe factors for which India is important for the GCC in their ‘Look East’ policy. Theavailability of large-scale skilled and semi-skilled manpower, and the policies of thegovernment, has made India a major destination for foreign direct investments. Thisoffers immense scope for the Gulf region to invest in India’s economic boom.11 TheGCC is also looking towards India as a strategic partner since the 9/11 terrorist attackshave induced a change in the security environment of the Gulf region. Although theUnited States remains the sole power for maintaining security and stability in the Gulf,the rulers are looking eastward to diversify their engagements in economic and strategicfields.

As a result of its engagement with the GCC states, India has managed to gather thesupport of two Gulf countries—United Arab Emirates (UAE) and Oman—in its bid forpermanent membership of the extended UN Security Council. Saudi Arabia has alsoagreed to support India’s candidature for a non-permanent seat of the UN SecurityCouncil and has sought India’s support for its own candidature for the year 2014/15.

High-level visits from India to the GCC countries have remained unimpressive.Most of the ministerial visits have intended to strengthen the existing trade and busi-ness and to look for new areas of cooperation, and they have severely lacked politicaland strategic significance. A majority of the exchange of visits between two sideshave comprised ministers and high-ranking officials from the departments of industry,energy, chemicals and fertilisers, petrochemicals, commerce, and so on.12

In this context, the visit of Prime Minister Manmohan Singh to Oman and Qatar inNovember 2008 is significant as it took place almost a decade after the visit of thenprime minister, Atal Behari Vajpayee to the region in 1998. During this visit, Indiasigned two agreements with Oman and three with Qatar. India signed an agreementregarding protection of the rights of five lakh Indian labourers who work in that country.Among others, the deal gives better job security to employees and rights to appeal inthe court to safeguard their interests. India and Oman also agreed to set up a $100 millionIndia–Oman Investment Fund and to take it further to $1.5 billion. Both countries willcontribute equally to the fund, which will finance projects in various sectors, includinginfrastructure, tourism, health, telecom and urban development.13

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Similarly, India signed two defence agreements: one on security and law enforce-ment, and another on defence cooperation with Qatar. The agreement on security andlaw enforcement lays out the framework for sharing of information and database onthreats posed by terrorists, money laundering and smuggling of narcotics, while the pacton defence cooperation lays out a structure for training programmes by the two sides,exchange of goodwill missions and experts.14 The pacts on intelligence sharing andsharing the database to tackle terrorism are of primary importance for India as it hasbeen a target of terrorists and seeks cooperation of all the countries to act upon it.

The visit also sent out a strong message regarding our concerns and interests withthe GCC countries.

Similarly, Vice-President Hamid Ansari also paid a visit to Kuwait in April 2009.This visit was the first high-level visit by an Indian since 1981 when Prime MinisterIndira Gandhi had visited Kuwait. During his visit, India and Kuwait signed threeagreements on science and technology, education and cultural exchanges.

Security and defence agreementsIndia has signed defence cooperation agreements with the UAE, Oman, Qatar and SaudiArabia. An agreement on defence cooperation was signed by India and UAE in 2003when Sheikh Mohammed bin Zayed Al-Nahyan, Chief of Staff of the UAE ArmedForces, visited India. The agreement aims at providing for military training, cooperationin military medical services and jointly combating pollution caused by the military atsea.15 Again, during the visit of Minister of External Affairs Pranab Mukherjee toUAE in May 2008, talks were held to explore ways to establish a ‘long-term’ defencerelationship based on possible joint development and manufacture of sophisticatedmilitary hardware, which is a step forward in efforts to streamline the military relation-ship, which so far has been dominated by naval ship visits and training exchange pro-grammes.16 India has also signed an extradition treaty and an agreement to combattrafficking in narcotic drugs with UAE.

India signed a memorandum of understanding on defence cooperation with Omanin December 2006. The areas of cooperation envisaged included exchange of expertisein military training and information technology, utilisation of military and educationalcourses and programmes, exchange of observers attending military exercises andexchange of formal visits.17

In 2006, India and Saudi Arabia signed a comprehensive Delhi Declaration whichincludes commitment by both the countries to cooperate in the fields of terrorism,energy security, political cooperation, technology, trade and investment, education,health and cultural exchanges. In the present context, India is wooing Saudi Arabiafor cooperation in combating terrorism in what seems to be a well-planned strategicmove as India is a victim of terrorism fomented by elements in Pakistan, who are fundedby several Saudi-based Islamic charity organisations.18

Irritants in India–GCC relationsThere have been a number of factors responsible for hindering strong political relationsbetween India and the GCC. While some of the factors are old and are of Cold Warorigin, some new issues have also cropped up in the post-Cold War scenario.

Firstly, the Kashmir issue has been a big obstacle in building a strong India–GCCrelationship. In the past, support of the Gulf countries to Pakistan over the issue has

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irked India. They are also supporters of various Organisation of Islamic Conferenceresolutions on Kashmir, which were pushed forward by Pakistan. They have also stoodwith Pakistan over the issue in the name of human rights of the Kashmir people, theirIslamic identity, plebiscite, and so forth. But over the years, the GCC countries havesoftened their stand and they now believe that the Kashmir issue should be solvedthrough bilateral negotiations and should be based on the Shimla and Lahore agreements.

Secondly, Pakistan has taken advantage of its close relationship with the GCCcountries and has depicted India as an anti-Muslim and Hindu-dominated country.India has witnessed a number of communal clashes between Hindus and Muslims.This fact has been exaggerated by Pakistan, which has repeatedly said that the IndianMuslims are not safe. Communal incidents in India, particularly the demolition of theBabri Masjid in Ayodhya in 1992 and the Godhra riots in Gujarat, has elicited a strongresponse from the GCC countries against the secular image of India. In fact, the GCCdescribed the Ayodhya events as ‘sacrilege and an unpardonable act’. At the 13th sum-mit of the GCC in Abu Dhabi in December 1992, the GCC adopted a resolution entitled‘Aggression against the Babri Mosque’ in which it expressed its ‘deep condemnationof the Babri Mosque demolition’, which was described as a ‘crime against MuslimHoly places.’ The resolution called upon the Indian government to uphold its respons-ibilities and take further measures to protect Muslims, their religious rights and placesof worship.19 India strongly reacted to the resolution and said that it is an ‘internalaffair’ of India and the Gulf countries should not have issued a resolution althoughthey could have deliberated on the issue.20

Similarly, the Kashmir issue has been interpreted in a very narrow and partialmanner by Pakistan, and on that basis it has sought support of the GCC countries invarious international forums. Historically, while India’s relations with the Gulf countrieshave been based upon trade and business, Pakistan’s relations with the region havebeen mainly ideological and political. Pakistan has particularly enjoyed very goodrelations with countries like Saudi Arabia and UAE.21 Thus, Pakistan has used itsreligious and political affiliation with these countries to further its economic, politicaland strategic interests, and at the same time undermine India’s secular credentials andinternational image.

Thirdly, the Cold War international political scenario has had its implications onIndia’s relations with the Gulf countries. While India was non-aligned but leanedtowards the Soviet Union during the Cold War, the Gulf countries stood by the UnitedStates and the West. India’s close relationship with Egypt, support for a socialist worldorder and alliance with Soviet Union did not allow a stable India–Gulf relationship tobuild up.

Fourthly, India’s close ties with Israel, particularly the Indo–Israeli defence coop-eration, which began in the 1990s, have irked the GCC countries. It has made themapprehensive of India’s stand on the Palestine issue, even though India has supportedthe Palestinian cause since the beginning and continues to do so even today. Gulfcountries have started complaining that India has toned down its voice against theoppression of the Palestinians. Although India has time and again assured of its undilutedstand over the issue, there still remains some scepticism among the Gulf countriesregarding Palestine.

Fifthly, in the recent times, India’s growing relationship with Iran has made themapprehensive. India is attempting to re-engage Iran, looking at an increased quantumof energy supply from Iran and at the same time broadening the trade basket andimproving political and strategic partnership. Although India’s opposition to the Iranian

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nuclear programme in the United Nations must have given some relief to the Gulfcountries, India’s desire to build up a strong political and economic relationship withIran has irritated them. Iran’s nuclear ambitions have made the GCC countries feelinsecure as it increases their vulnerability and at the same time threatens to change thebalance of power in the region.

Time for enhanced political engagements and to look beyond businessIn recent times, the GCC has undergone several changes and transformations in itsreach and outlook. The GCC has taken some decisions that broaden the horizon of itsengagements with the outside world, including India, both in economic and politicalfields. India should take advantage of such liberal moves and engage them more seri-ously to further its interests in the region.

The GCC countries have acknowledged the growth of their big Asian neighboursand have adopted a ‘Look East’ policy to promote cooperation with them. It must bementioned here that India’s growing economy, increasing demand for energyresources, need of the GCC countries to diversify their investment, and so forth, hasmade them look eastward, and India along with China is a major target country undertheir ‘Look East’ policy.22 Recently, the GCC has also shown some flexibility indealing with the outside world. The GCC took a decision in 2008 to connect to Europeby train. It is expected that the project work will start soon and take five to six years tocomplete, which will connect the Gulf to Turkey. The GCC is dealing with a numberof countries around the world like the European Union, Japan, China, Australia, NewZealand, South Korea, Jordan, and so forth, and is signing FTAs with these countries.The GCC has also signed a document with the Organisation of Islamic Conference in2008, which aims to promote cooperation in the political, cultural, media, economic,social and environmental areas. The GCC formed a customs union in the year 2003and a GCC common market in 2008. A GCC Monetary Authority is also in the pipeline,which if approved would run parallel to the central banks in the region, improve policycoordination and promote convergence of national financial systems.23 For furtheringtheir trade and to add more weight to their bargaining power, the GCC is planning tointroduce a single currency by the year 2010.

Thus, it is in India’s interest to engage the GCC politically and diplomatically. Inthe world scenario, India desires to be a major world power and therefore it needs toengage its extended neighbourhood more productively. The active support from theseneighbours will not only provide India the much-needed political and diplomaticstanding, but will also positively change India’s image in rest of the Muslim world.Building a cordial relationship with the GCC will be a very useful platform to beginthat process. Also, India’s longstanding demand for permanent membership of theSecurity Council will receive a boost with the support of the countries in our extendedneighbourhood.

The geo-strategic importance of the Gulf region is widely acknowledged andevery country wants to have its influence in the region. The United States is the dom-inant player in the Gulf today and other big powers, like Russia, China, Japan, and soon, are seriously vying for their respective spaces in the Gulf. While India should notcompete with the big powers for exercising supremacy in the region, a policy of con-tinuing friendship and diplomatic engagement in the Gulf will be beneficial for it.Thus, apart from maintaining healthy trade and commerce relations, India should optfor political and strategic engagements with these countries.

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During the last decade, the strategic environment in the Gulf region has undergoneseveral changes. The events of 9/11, in which 15 of the 19 hijackers were found to beSaudis, the US attack on Iraq, the continuing stand-off between the United States andIran over the nuclear issue, and the Israeli threat to attack Iran has given a new dimen-sion to Gulf security and strategic environment. Political stability and security in theGulf region is in the interest of India, which should forge closer ties with the Gulfcountries. New threats and conflicts in the region have thrown fresh challenges to India,and it is time for New Delhi to convert these challenges into opportunities by enhancingcooperation with the GCC.

Terrorism is an important issue over which India can engage with the GCC. Of allthe GCC countries, Saudi Arabia is the biggest victim of terrorism, with the scourgeof Al Qaeda continuing in the country. In recent times, Al Qaeda’s movement has alsobeen noticed in countries like Kuwait, Qatar, and so forth. As far as India is concerned,there is evidence of a number of Pakistani and Kashmiri militant groups getting financialsupport from the Gulf. Militant groups like Lashkar-e-Toiba and Jammaat-e-Islami havegot financial support from Saudi Arabia and several charity organisations in theGulf.24 Thus, India should seek to work in close cooperation with the GCC in terms ofintelligence sharing, tracking the movement of the terrorists, money, arms, and so forth.

Maritime security is another area of cooperation between India and the GCC.Although terrorists have been attacking India mainly on land, the November 26, 2008Mumbai attacks clearly exposed the weakness of India’s maritime security and thepossibility of terrorist threats emerging from the sea. Similarly, securing sea lanesfrom pirates is also another area of concern for both India and the GCC. In the recentyears, both India and the GCC countries have been victims of piracy off the Somalicoast. A joint effort on the part of the navies of India and GCC countries to checkpiracy in the region will be beneficial for both. Primary concerns of India lie in thesafety of oil tankers in the Arabian Sea, Strait of Hormuz and the Gulf of Aden. India hasexpressed its interest in undertaking naval exercises with the GCC at both bilateraland organisational levels. To date, India has already held naval exercises with countrieslike Oman, Saudi Arabia, Bahrain and Kuwait.

Illicit trafficking remains a major concern for both India and the GCC, as traffickingof narcotics and small arms takes place frequently. It has been found that narcoticsproduced in Afghanistan make their way to the GCC countries and as well as India.Narcotics are supplied from Afghanistan to India via Pakistan and to the Gulf viaPakistan, Iran and Iraq. Dubai is a major port of transit for these illicit drugs, whileSaudi Arabia is emerging as a potential consumer in the region.25 According to theInternational Narcotics Control Strategy Report 2009 of the US State Department,Dubai is a major regional transportation, financial, and shipping hub. Hashish, heroin,and opium shipments originate in Afghanistan, Pakistan, and Iran, and are smuggledin cargo containers, via small vessels and powerboats, and/or sent overland via Oman.26

In recent times, some individual GCC countries, like UAE, Oman and Qatar, haveintroduced some measures to check and regulate the flow of narcotics and are devisingways to prohibit their land being used as a transit or as a destination. India and the GCCneed a joint effort in this regard to check the flow of drugs into their territories.

Similarly, illicit supply of small arms has been a cause of worry for both India andthe GCC. Identifying the supply routes, breaking into the arms supply networks and,finally, identifying the receiving groups will require a joint effort. Money launderingis also a concern and there has not been complete success on the part of both India andthe GCC to regulate and put curbs on that. While expatriates use the hawala channel

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to avoid banking hassles, terrorists and criminals use it for safe and untraceable transfer.Further, the nexus between terrorists and criminals with the narcotics smugglers andthe hawala channel makes it further difficult for the governments to control the threat.

The November 2008 terrorist attacks on Mumbai exposed loopholes in the currentIndian engagements with the Gulf region. One saw two contradictory kinds of responsesfrom the region to the attacks. All the leaders of the GCC countries were quick to con-demn the incident severely and appealed to India to observe restraint and not initiate anymilitary action against Pakistan. Without supporting India’s accusation of Pakistan’sinvolvement in the incident, they asked both countries not to get involved in a militaryconflict. Against this, public opinion—as reflected through the newspapers andmedia—was not very supportive of India’s concerns. It rather sympathised with Pakistanand said that Pakistan has been a victim of terrorism. And some even went to theextent of saying that, after the Mumbai attacks, the stage had been set for military actionagainst Pakistan by the new US President Barrack Obama. Some sections of the mediaimplied that India was already in the Western camp and will be an active player inredrawing the geo-political map of the region.27 Such responses highlight the absenceof civil society interaction with the GCC countries. In this case, apart from the usualinteraction at the government and diplomatic levels, people-to-people contacts holdthe key to understand India’s viewpoint, outlook and principles on a variety of issues.

The Mumbai attacks not only challenged the security of India, but also threw seriouschallenges to our political and strategic engagements with the Gulf region. After theMumbai carnage, Saudi Foreign Minister Prince Saud Al-Faisal visited India and reit-erated Saudi Arabia’s offer to jointly fight against terror. Later, India sought Saudihelp to pressurise Pakistan to check extremist elements operating from its territory.The Foreign Minister of Oman, Yusuf Bin Alawai Bin Abdullah, also visited Indiaafter the Mumbai incident. Although sympathetic towards India’s concerns, he did notaccuse Pakistan of harbouring terrorists; rather, he appealed to Pakistan to dismantlethe terror networks operating inside its territory. At this point of time, India needs thevocal support of the GCC countries on the issue of terrorism and must devise ways withthem to deal with the problem.

Common political and security concerns and threats to both India and the GCCrequire a more rigorous engagement between the two going beyond a trade and busi-ness relationship. There are serious existing issues, which need immediate attention,and a joint effort will yield the desired results. India should take advantage of thenew-found outlook of the GCC as it is opening up for the world as well as makingstrides for the development of the organisation itself. India should re-engage the GCCon the issues like political cooperation, intelligence sharing on the activities of terror-ists and criminals, safeguarding the interests of the Indian migrant workers, culturalexchanges and technological cooperation.

India’s optionsThere are a number of options available to India to broaden its engagement with theGCC. India should keep in mind that Cold War calculations and the strategic environ-ment are over, and initiatives should be taken without any prejudice. While India’sengagement with the Gulf countries during the Cold War era was based on necessity(imports and exports), the rise of India as a reliable democratic, military and economicpower in the era of globalisation has changed that perspective and made them to lookat India on multiple fronts.

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Step up bilateral visitsIndia must play a proactive role and come up with a broad agenda of engagementrather than waiting for the GCC to take the initiative. India should step up high-levelbilateral visits with the GCC countries, as frequent bilateral visits erase misunder-standings, bridge the communication gap and, more importantly, instil faith in theminds of the Gulf rulers to deal with India.

Signing the FTAToday, concluding the FTA with the GCC remains the biggest challenge for India.Although talks on an FTA have been going on for the last four years, both parties havenot been able to reach a consensus. The negotiations were expected to be over by theend of 2008 but it seems to be taking more time. Signing a FTA with the GCC willincrease India’s trade with the bloc and provide India with long-term access to theGulf market. It will also draw more foreign direct investment to India, creating amutually beneficial environment of trade between India and the GCC countries.

Identify common issuesApart from trade and business, India should identify issues of mutual concern andinterest, and engage with the GCC over them. In recent times, terrorism has been anissue of common interest to both India and the GCC. India and Saudi Arabia havebeen victims of terrorism and Islamic radicalism; other smaller Gulf countries are veryprone to radical Islamic ideologies and terrorism. Similarly, issues like piracy, moneylaundering, illicit drug trade, arms trade by criminal groups, and so forth, are of mutualconcern for India and the GCC. Cooperation in these fields can yield more practicalresults for both the parties.

Using soft powerPeople-to-people contacts and cultural exchange programmes with the GCC countriesshould be established. In this regard, setting up cultural centres across the region willbe a constructive idea for India. Also, the exchange of academics, media persons andintellectuals, and the distribution of books, journals, newsletters, and so on, can leadthem to understand India’s viewpoint better and remove any ambiguities they mayhave. At present, a number of Indian schools and educational institutions are alreadyoperating in the Gulf region. More institutions should be encouraged to open branchesin the Gulf, and students from GCC countries should be encouraged to come andstudy in Indian colleges and universities.

Strengthening ties with Saudi ArabiaInitiating and taking forward the partnership with the most influential GCC member(i.e. Saudi Arabia) will strengthen India’s bargaining power with the organisation.Saudi Arabia is not only the largest in terms of size and population, it is also a majorfinancial power. Indo–Saudi relations were taken to a new height with the visit ofKing Abdullah to India in 2006. Saudi Arabia has expressed keen interest to broadenits engagements with India, and it is time for us to make the most out of it.

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Broadening regional cooperationAt a broader level, India also can propose regional cooperation between the Gulf andthe South Asian region. In this regard, cooperation between the two regionalorganisations—the Gulf Cooperation Council (GCC) and the South Asian Associationfor Regional Cooperation (SAARC)—can be seriously considered. As India is the big-gest power in South Asia and enjoys considerable influence over the SAARC, it canbenefit from contacts with the GCC. Again, establishing formal relations between thetwo regional organisations will help in stabilising the relationship in the longer runand make both understand each other better.

ConclusionHistorically, India has enjoyed good neighbourly relationship with the Gulf countries.Much of this has been eroded due to a number of reasons. India should try to restoreits lost respect and influence, and bridge the communication gap with her extendedneighbourhood through frequent interactions. Despite the large volume of bilateraltrade, political relations have not stabilised between the two. But, for the future securityof trade as well as the other mutually beneficial relations, a firm political relationship,will and commitment must be reflected in the bilateral relations from both the sides.Now, as the GCC is opening up to the world for various economic, strategic and securityreasons, India should take it as the right opportunity to improve its relationship withthem and mend its lost grandeur in that part of the world.

Economic relations remain the mainstay in the India–GCC relationship. Signing theFTA with the GCC will be a major achievement for India, as it will give India immenseeconomic benefits and will widen the scope and opportunity to further improve its bilat-eral relations. While maintaining the momentum in the trade and business front, Indiafaces the challenge of improving her political and strategic relationship with the GCCcountries. The stable economic relations should be supplemented by political, strategicand cultural relations to take the India–GCC relations ahead. A stable Gulf is not onlyimportant for India from an economic point of view, but also India’s future strategic andsecurity goals in the extended neighbourhood to a large extent are dependent on it.Apart from that, the pressing issues like terrorism, piracy, trans-national criminal activi-ties, and so forth., also need active cooperation between the two. Thus, at this crucialjuncture, when the GCC is looking ‘East’ and India towards the ‘West’, both shouldtake it as the right opportunity to improve their relationship with each other.

AcknowledgementsThe author thanks the two anonymous referees for their valuable comments and suggestions on thepaper.

Notes1. The GCC was formed in 1981 by the states of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia

and the United Arab Emirates.2. Trade Talk: A Newsletter of Confederation of Indian Industries, 2(5), June 2007, available at

http://cii.in/documents/TradeTalk_%20June_2007.pdf3. The imports figures do not include import of petroleum products and crude oil. Export–Import

Data Bank, Department of Commerce, Ministry of Commerce and Industry, Government ofIndia, available at http://commerce.nic.in/eidb/default.asp (Accessed January 27, 2010).

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4. Ministry of External Affairs, Government of India, at http://meaindia.nic.in/onmouse/gcc1.pdf5. Ibid.6. Press release, Department of Commerce, Ministry of Commerce and Industry, Government of

India, May 30, 2007, available at http://commerce.nic.in/pressrelease/pressrelease_detail.asp?id=2062

7. PM Launches ‘Look West’ Policy to Boost Cooperation with Gulf, Press release, Prime Minister’sOffice, July 27, 2005, available at http://pmindia.nic.in/prelease/pcontent.asp?id=278

8. Prakash C. Jain, ‘An “Incipient” Diaspora: Indians in the Gulf Region’, in Prakash C. Jain(ed.), Indian Diaspora in West Asia: A Reader, Manohar Publishers, New Delhi, 2007,pp. 198–199.

9. N. Janardhan, ‘GCC–India FTA Talks Give Fillip to Asian Community’, Arab News, January 5,2006.

10. N. Janardhan, ‘Managing Foreign Workforce in the Gulf: Redefining the Rules of Engage-ment’, in N. S. Sisodia and Ashok K. Behuria (eds), West Asia in Turmoil: Implications forGlobal Security, Academic Foundation, New Delhi, 2007, p. 436.

11. Rafiullah Azmi, ‘GCC “Looks East”: Saudi Arabia’s Engagements with India’, India Quar-terly, 62(4), 2006.

12. Bansidhar Pradhan, ‘Changing Dynamics of India’s West Asia Policy’, International Studies,41(1), 2004, p. 69.

13. The Financial Express, November 8, 2008, available at http://www.financialexpress.com/news/india-oman-ink-100mn-fund-to-finance-projects/383132/

14. ‘Pacts Signed with Qatar Very Significant, Says PM’, Gulf Times, November 12, 2008. 15. ‘India, UAE Ink Accord on Defence Tie-up’, The Hindu, July 2, 2003. 16. Atul Aneja, ‘India, UAE Consider Shoring Up Military Ties’, The Hindu, May 14, 2008. 17. ‘India, Oman sign MoU on Defense Cooperation’, available at http://www.globalsecurity.org/

wmd/library/news/india/2005/india-051207-irna02.htm18. For a profile of the Pakistan-based jihadi organisations and their external funding sources, see

Muhammad Amir Rana, A to Z of Jihadi Organisations in Pakistan, Marshal Books, Lahore,2004.

19. A. K. Pasha, ‘India and the GCC’, in Riyaz Punjabi and A. K. Pasha (eds), India and theIslamic World, Radiant Publishers, New Delhi, 1998, p. 38.

20. Ibid.21. For an elaborate discussion on Pakistan’s relations with the Gulf countries, see Faryal Leghari

(ed.), Gulf–Pakistan Strategic Relations, Gulf Research Center, Dubai, 2008.22. Javed Ahmed Khan, ‘India and Arab Gulf’s Look East Policy: Strengthening Economic

Relations since 1995’, in Anwar Alam (ed.), India and West Asia in the Era of Globalisation,Century Publications, New Delhi, 2008, pp. 55–70.

23. Middle East Economic Survey, 51(37), 2008. 24. For a detailed profile of the terrorist organisations operating in Kashmir, see K. Santhanam,

Sreedhar, Sudhir Saxena and Manish (eds), Jihadis in Jammu and Kashmir: A PortraitGallery, Sage and IDSA, New Delhi, 2003.

25. Faryal Leghari, ‘Narcotics Trafficking to the Gulf States’, Gulf Research Center, Dubai, avail-able at http://www.grc.ae/data/contents/uploads/WMD_-4th_Issue_faryal_9441.pdf

26. International Narcotics Control Strategy Report 2009, State Department of the USA, availableat http://www.state.gov/p/inl/rls/nrcrpt/2009/vol1/116525.htm

27. Atul Aneja, ‘How West Asia Views Mumbai Attacks’, The Hindu, December 17, 2008. Dow

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