New Delhi seeks enduring trade ties with GCC partners
Pranab Mukherjee said it was time for the UAE and its partners in the six-nation Gulf Cooperation Council (GCC) to shift their emphasis on Western markets towards India and other eastern countries.
In a lecture in Abu Dhabi this week, Mukherjee also said India is willing to meet the growing needs of the GCC nations for labour as they push ahead with massive infrastructure development programmes in the current oil boom.
"The countries of the GCC have generated extraordinary economic surpluses. More importantly, they are today looking beyond their traditional investment partners in the West – in fact, the 'Look East' policy is important to all the GCC countries," he said in the lecture at the Abu Dhabi-based Emirates Centre for Strategic Studies and Research (ECSSR), a UAE government think-tank.
"Given the Gulf's vast oil reserves and our countries' geographical proximity, India and the Gulf will remain long-term partners in the energy sector. However, the challenge before us is to transform the present buyer-seller relationship into something more substantial and enduring, covering all economic sectors from energy to education and health," he said in the lecture, published yesterday.
Mukherjee said energy security and development of infrastructure are two of the most pre-requisites for continued high economic growth rates in India.
His figures showed India needs $500bn (Dh1.83bn) in financial resources to meet specific targets for infrastructure development and electricity production.
"Here are the foundations of India's new terms of engagement with the Gulf region… now, as the countries of the Gulf embark on massive programmes of infrastructure development, including their hydrocarbon industries, India is in a position to meet their workforce needs for professionals, technicians and labour. Indeed, as the Gulf economies move toward the development of the services sector, more Indian professionals have begun to come to the Gulf," he said.
"However, challenges lie ahead. The world today is characterised by two robust but contradictory trends. The first is the trend toward globalisation, where national boundaries are becoming less relevant in the wake of the movement of technology, finance, information and personnel. However, this scenario of a world without borders is challenged by the other trend, which is the tendency to reject globalisation and to assert respective identities and interests."
More than 70 per cent of India's oil imports of around $60bn in 2006 came from the GCC countries, mainly the UAE and Saudi Arabia.
The GCC is also India's second largest trading partner and the top single origin of imports into India. Bilateral trade peaked at nearly $25bn in 2006, excluding energy imports by India worth approximately another $22bn.