Significance of India’s ties with Gulf countries

The Organisation of Islamic Cooperation (OIC) Secretariat, “condemned and denounced” statements made by two spokespersons of India’s ruling party, the BJP, for their comments on Prophet Muhammad. The statement of the OIC also referred to the spate of hatred and defamation of Islam in India. The OIC, founded in 1969, has 57 member countries, all of whom have Muslim-majority populations. India, with more than 200 million Muslims, is not a member and does not even have observer status. India has the second-largest Muslim population of any country, only next to Indonesia.

The Indian government rejected the OIC statement and said that the views of two individuals do not reflect the views of the government, or indeed that of the people of India. Along with the joint statement of OIC, many of its members summoned the Indian ambassadors in their respective countries and expressed disappointment and their condemnation of statements on the Prophet. The embassies defended the stance of the government.

Two countries that summoned Indian envoys are Qatar and Kuwait. Both these countries are also a part of the six-member Gulf Coordination Council (GCC). It is to be noted that two other members of the GCC, Bahrain and Oman, publicly appreciated the measures taken by the government and the BJP against the two spokespersons. Their actions at least show that not all members of the GCC, or indeed of the OIC, are equally vehement or determined to corner India diplomatically. It is without a doubt that this incident has been an embarrassment to the government, and that is why strict action was taken against the two spokespersons. It was not only the OIC statement but even the observations and comments of other countries, including America, that put India on the backfoot.

In the wake of the international furore came the wave of protests, violence and police action, at times quite brutal, within the country, which is a source of major headaches and embarrassment. The two (or maybe three) camps are getting firmly divided and entrenched, on issues of freedom of speech, selective outrage, blasphemy and majoritarian politics. The space for dialogue and nuance is shrinking fast. This does not bode well for social unity, harmony and cohesion, even if these words sound hopelessly utopian now.

Democracy is nothing but a continuous conversation and negotiation of power and its sharing. But that conversation must respect certain norms, written and unwritten, and the negotiation must always remain civilised, non-violent, and respect constitutionalism. One of the other warring party can blame the other for lowering the level of the discourse and making the “negotiating space” uglier. Whichever group is to be blamed for “you did it first”, the outcome for society is that it makes everyone worse off.

The OIC and GCC diplomatic outcry have another implication that India must evaluate. The issue of morality in geopolitics is problematic and cannot be resolved. But the issue of India’s self-interest is very relevant. This is an instrumental view of observing diplomatic niceties. India cannot afford to get isolated diplomatically since that will have real economic implications.

At a time when India has to meet the China challenge and reduce its import dependency on China, it is imperative for India to keep its coalition options open. This is for both geo-economic and geo-political reasons.

Additionally, the linkage with the countries of GCC has multiple dimensions. The first is that of trade dependence. India’s trade with the GCC countries nearly doubled in just one year since 2020-21 and is at $155 billion presently. The share of India’s exports that go to the GCC is now above 10% and needs to rise. India’s growth requires access to global export markets, and GCC is an important destination, for all sectors, ranging from food, agro-processed products, labour-intensive products like textiles and leather, engineering goods, chemicals and pharmaceuticals. India’s imports from GCC are also crucial and went up by 86% in one year. Imports include the critical energy component. Oil imports from West Asia are needed not only to meet India’s own consumption requirements but also as feedstock for India’s huge export of diesel and petrol, done by private sector companies like Reliance and Essar. India’s petro-product exports constitute nearly one-fifth of all manufacturing exports in dollar terms.

The GCC countries also constitute an important destination for software and other services exports. In May this year, India signed a free trade agreement with the UAE, a member of the GCC. The ambition is to take the trade with the UAE alone to $100 billion in the next few years. So, a strong trade and commerce linkage call for the removal of any diplomatic awkwardness.

The second dimension as far as the GCC is concerned is the presence of India’s diaspora. In the UAE alone, the population of people of Indian origin is nearly 40%, and a substantial proportion of these are Indian Muslims. The ratio of Indians in other GCC countries is also quite high. They are a big source of remittance income for the Indian economy. India is the world’s number one receiver of inward remittances, at nearly $90 billion. This income can easily reach $200 billion if the diaspora linkage is nurtured and enhanced.

In some ways, the inbound remittance represents India’s labour “exports” of its most abundant resource. This export is not of software “brains” but also of blue-collar workers. Indeed, the remittance economy can easily match the earnings from software exports. The GCC countries are host to a large proportion of blue-collar work, which goes to people of Indian origin.

Beyond these two dimensions of trade and diaspora linkage, a third factor is civilisational ties. Countries like the UAE and Oman can be natural allies to India due to a much older linkage between our peoples. This linkage and alliance have geostrategic advantages, too, for India as we explore land links to Central Asia and the possibilities of energy pipelines.

Hence for these instrumental reasons alone, if not more fundamental reasons, India needs strong and friendly relations, be they diplomatic, economic, social or cultural with the countries of the GCC. And some of these arguments carry over to relations with members of the OIC, too.

(The writer is a noted economist)

(Syndicate: The Billion Press)