India's pivot to the Middle East

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The outcome of the recent G20 summit organized by India underscores a fundamental shift in global geopolitics and offers promising signs for the future of multilateralism. Indeed, the New Delhi Leaders’ Declaration is a beacon of consensus in an era when international cooperation seems increasingly fraught.اضافة اعلان

At the G20 in New Delhi, India championed the Global South in several ways, such as advocating for inclusion of the African Union as a permanent member and calling for reforms to multilateral development banks.

Yet the highlight was the announcement of the India-MiddleEast- Europe Economic Corridor (IMEC). This groundbreaking initiative not only signifies India’s deepening ties with the Middle East but also holds the potential to transform global economic, trade, and geopolitical landscapes.

When US President Joe Biden termed the IMEC a “game-changing investment,” he underscored the potential impact this corridor will have for the regions directly involved, and the broader international community.

The railroad and transportation links proposed in the IMEC are aimed at providing a “reliable and cost-effective cross-border ship-to-rail transit network,” which is likely to have cascading benefits on global supply chains and trade dynamics. European Union President Ursula von der Leyen highlighted the corridor’s potential to cut travel time by 40 percent, describing it as the quickest link between India, the Middle East, and Europe. Once completed, the corridor will reduce transport costs significantly.

India’s pivot toward the Middle East, and especially Gulf Cooperation Council countries (GCCs), has been a key policy priority of Prime Minister Narendra Modi. Far from a monolithic relationship anchored only in oil and market access, India's alliance with the Middle East extends to nuanced interplays of security cooperation, cultural affinity, and technological exchange.

During a recent state visit to India by Saudi Arabia's Crown Prince Mohammed bin Salman, the two sides co-chaired the first meeting of the India-Saudi Strategic Partnership Council, discussing topics such as politics, security, and investment. Deals ranged from energy and digitization to anti-corruption and seawater desalination.

India's burgeoning relationship with the United Arab Emirates has also reached new zeniths, evident from the extensive collaborations and diplomatic exchanges between the two countries. Prime Minister Modi's five visits to the UAE in the last eight years have been pivotal in shaping these ties, with trade figures hitting a staggering $85 billion this year.

Underpinning this economic alliance is the Comprehensive Economic Partnership Agreement, signed in February 2022, which has helped boost bilateral trade by approximately 15 percent.

Furthermore, agreements aimed at promoting the use of local currencies for cross-border transactions and integrating payment systems, energy partnerships, a joint commitment against extremism and terrorism, and engagement in the I2U2 Group – comprising India, Israel, the UAE, and the United States – are testament to the depth of mutual trust. A plan for establishing the Indian Institute of Technology Delhi in Abu Dhabi demonstrates the nations’ commitment to shared academic and technological advancements.

India’s diaspora in GCC countries has been a pivotal force in strengthening these relations. Home to 9 million Indians, the Gulf is a top destination for Indian expatriates, with 3.4 million residing in the UAE and 2.6 million in Saudi Arabia alone. The significance of this diaspora was emphasized during the Saudi crown prince’s visit to New Delhi, where he described Indians in the Kingdom as integral to the country. “We consider them to be a part of Saudi Arabia,” he told Modi. “We watch and take care of them like we take care of our own citizens.”

Despite the strong bonds that already exist, India and the Middle East still have multiple avenues for future collaboration.

First, finalization of the India-GCC Free Trade Agreement (FTA) can serve as a cornerstone for enhancing economic ties.

Second, in the arena of frontier technologies, both regions can leverage their burgeoning tech ecosystems for mutual growth, particularly in sectors like blockchain, Web 3.0, and the Internet of Things (IoT).

Third, collaboration in artificial intelligence can create innovations in health care, agriculture, and smart cities.

Fourth, space technology offers an untapped potential, where satellite communication and space exploration can be jointly developed.

Finally, India's ambitious renewable energy goals can attract significant investment from the Middle East, which is also diversifying into sustainable energy sources.

Much work remains to implement the newly announced IMEC, and several ports and rail links still need to be built. But the groundwork has been laid. In time, the India-Middle East-Europe corridor could very well be the game changer that the region needs.

Aditya Sinha is an Officer on Special Duty, Research, at the Economic Advisory Council to the Prime Minister of India. X: @adityasinha004

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