India and Saudi Arabia Strengthen Trade and Economic Ties with Inaugural High-Level Task Force on Investments
In a significant move, India and Saudi Arabia have enhanced their trade and economic relations through the establishment of the countries’ first-ever High-Level Task Force on Investments. This milestone comes after the Kingdom’s Crown Prince Mohammed bin Salman pledged $100 billion in investments in India during his official visit to the Asian nation. The task force, initiated in 2023, held its inaugural meeting virtually on July 30, co-chaired by Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman and PK Mishra, principal secretary to Indian Prime Minister Narendra Modi.
During the discussions, India extended an invitation to Saudi Arabia’s Public Investment Fund to set up an office in India, aiming to attract investments from the Kingdom. The meeting explored various opportunities for bilateral investments in sectors such as refining, petrochemical plants, renewable energy, power, telecom, and innovation.
India’s prime minister’s office stated that a delegation led by the country’s Petroleum Secretary will visit Saudi Arabia to further discuss mutually beneficial investments in the oil and gas sector. Both nations agreed to ongoing consultations between their technical teams to advance negotiations and finalize specific investments. Additionally, India invited the Saudi energy minister to New Delhi for the next round of High-Level Task Force meetings.
Crown Prince Mohammed bin Salman, India’s President Ram Nath Kovind, center, and Indian leader Narendra Modi at a ceremonial reception in 2019. (AFP)
Historical Background of India-Saudi Arabia Relationship
Since 1947, India and Saudi Arabia have maintained strong economic and trade ties. The relationship took a significant turn with the signing of the Delhi Declaration in 2006, followed by the Riyadh Declaration in 2010, which upgraded the bilateral relationship to a strategic partnership. Prime Minister Modi’s visit to Saudi Arabia in 2016 further strengthened cooperation in political, economic, security, and defense areas.
During the crown prince’s visit to India in 2023, both countries signed eight agreements covering energy, banking, investment, manufacturing, archival cooperation, anti-corruption, and water desalination. Apart from economic ties, India and Saudi Arabia share a deep cultural bond, with the Kingdom being a preferred destination for Indian talents and religious tourists.
Current Trade Dynamics between Saudi Arabia and India
According to the Consulate General of India in Jeddah, Saudi Arabia ranks as India’s fourth-largest trade partner, while India is the Kingdom’s second-largest trade partner. The Consulate General acknowledges Saudi Arabia as a vital partner for energy security and economic collaboration, including investments and technology transfers.
Statistics from the General Authority for Statistics indicate that in 2023, Saudi Arabia’s exports to India totaled SR113.35 billion ($30.20 billion), with imports from India amounting to SR43.57 billion. The Kingdom was the third-largest crude exporter to India in 2023, accounting for 16.7% of the country’s total oil imports.
Growth in Tourism Sector and Cultural Exchange
In addition to economic ties, India and Saudi Arabia share robust connections in the tourism sector. Over 1.5 million Indian tourists visited the Kingdom in 2023, a 50% increase from the previous year. The Saudi Tourism Authority aims to attract 7.5 million Indian visitors in the next seven years through strategic initiatives.
Air connectivity between Saudi Arabia and India has increased by 31% from 2019 to 2023, with flights connecting major hubs in both countries. Saudi Arabia’s tourism growth, driven by projects like NEOM and developments in Alula, Diriyah, and the Red Sea, has positioned the Kingdom as a global tourist destination.
India has also emerged as a favored destination for tourists from Saudi Arabia, with routes from Riyadh to New Delhi and Lucknow being popular choices. The dynamic travel landscape reflects India’s appeal to leisure and business travelers from the Middle East, highlighting the strong bilateral ties between the two nations.