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UPSC Sansad TV: AIR- Strengthening Bilateral Relationship between India and Saudi Arabia

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Why Saudi Arabia is important for India

  • The approximately 2 million strong Indian community is the largest expatriate community in the Kingdom and is highly respected due to its sense of discipline, as well as law abiding and peaceful nature.
  • Saudi Arabia is an important and reliable source of India’s energy requirements.
  • India imports around 18% of its crude oil from Saudi Arabia, making it the 2nd-largest source of crude oil for the country.
  • It is also now India’s fourth largest trading partner with bilateral trade at $27.48 billion.
  • Saudi investment of around $100 billion is in the pipeline in areas ranging from energy, refining, petrochemicals and infrastructure to agriculture, minerals and mining.
  • Saudi Aramco is participating in a major refinery and petrochemical project on India’s west coast.
  • Defence, security, trade, culture, education and people-to-people contacts are the important areas of bilateral cooperation with Saudi Arabia
  • During his visit to New Delhi in February 2019, the Crown Prince had committed to invest over $100 billion in sectors of priority in India.

Why India is important for Saudi Arabia?

  • The contributions made by the Indian community to the development of Saudi Arabia are well acknowledged. Saudi authorities announced an amnesty period between April – November, 2017 during which around 70,000 Indians were issued travel documents to return to India.
  • Pragmatism is dictating Saudi posture as the very future of the kingdom’s economic model is at stake.
  • Economic reform programs are underway in Saudi Arabia, for which it needs India’s economic as well as technological assistance.
  • Saudi Arabia appears to have limited experience in countering threats from groups like Houthi militias
  • This is an area where India’s expertise in fighting such threats could be imparted to the Saudi side, by enhancing joint military training programs.

Current Scenario and its analysis:

  • There is strong political will in both India and Saudi Arabia to take relations to new heights.
  • The current scenario is unlike the Cold War period when India-Saudi Arabia ties were mainly determined by the Pakistani factor.
  • For decades, this prevented both New Delhi and Riyadh from discovering the strategic importance of engaging one another.
  • Lately, there have been indications that Saudi Arabia is less interested in meddling in India’s internal affairs.
  • Alongside the growing politico-economic ties, cooperation in the security realm is significantly progressing.

Challenges for India:

  • The politics of the Middle East are complex and multidimensional.
  • The Saudi Arabia-Turkey rivalry is one of the dimensions.
  • Another dimension is the Saudi Arabia-Iran rivalry.
  • India has close relations with both Saudi Arabia and Iran. However, India is yet to work out a way to balance its ties with Iran on the one hand and Saudi Arabia and the United States on the other.

Way Forward:

  • Uplifting cooperation in the maritime security domain from the current status would be in the interest of both countries.
  • Holding joint naval exercises is important for maritime security cooperation as well as to safeguard international trade via sea routes.
  • Space is an important domain where bilateral engagements could be strengthened.
  • India could explore the possibility to engage with the newly established Saudi Space Agency.
  • The potential areas for next stage of bilateral cooperation could be greater bilateral synergy in Indian infrastructure, agriculture, start-ups, skilling and IT.
  • Shifting some labour-intensive establishments from Saudi Arabia to India would serve the respective national priorities by reducing the kingdom’s expatriate population and boosting ‘Make in India’.