India Signs Negotiation Framework to Advance Free Trade Pact with GCC

India Moves Towards a Comprehensive Trade Pact with the GCC

India has taken a decisive step towards concluding a comprehensive free trade agreement (FTA) with the Gulf Cooperation Council by signing the Terms of Reference (ToR) for negotiations. The move signals a renewed push to deepen economic engagement with one of India’s most vital trading regions at a time of global economic uncertainty and supply-chain realignments.

The ToR provides the formal basis for launching structured negotiations between India and the six-member GCC bloc.

What the Terms of Reference Enable

The signing of the ToR lays down the scope, structure, and negotiating modalities for the proposed India–GCC FTA. It allows both sides to begin formal discussions on:

• Tariff liberalisation

• Market access for goods and services

• Investment facilitation

• Regulatory cooperation and standards

The GCC comprises Bahrain , Kuwait , Oman , Qatar , Saudi Arabia , and the United Arab Emirates , together forming India’s largest regional trading partner.

GCC’s Importance in India’s External Trade

The GCC plays a central role in India’s trade and energy security, accounting for over 15% of India’s total global trade .

• India’s exports to the GCC are valued at about USD 57 billion (≈ ₹4.7 lakh crore)

• India’s imports from the GCC , dominated by crude oil, natural gas, and petrochemicals, stand at around USD 122 billion (≈ ₹10.1 lakh crore)

Over the past five years, bilateral trade between India and the GCC has expanded at an average annual growth rate of nearly 15% , underscoring the bloc’s growing economic relevance.

Government’s Priorities in the Proposed Agreement

Commerce and Industry Minister Piyush Goyal stated that the proposed FTA would build on existing economic complementarities and create new opportunities for Indian exporters and investors.

Key focus sectors include:

• Food processing and agri-products

• Infrastructure and construction

• Petrochemicals and energy-related industries

• Information and communication technology

• Services, including healthcare and education

Negotiations are also expected to address mobility-related issues , such as visa facilitation for Indian workers and professionals, along with measures to boost two-way investment flows.

Reviving a Long-Pending Negotiation Track

India and the GCC had earlier initiated FTA discussions, but talks were stalled after the bloc temporarily