Shortly after India finalized discussions for a Free Trade Agreement (FTA) with Oman, sources informed CNBC-TV18 that the Gulf Cooperation Council (GCC), consisting of six nations, has agreed to separate its discussions for a Bilateral Investment Treaty (BIT) from the Terms of Reference (ToR) for an FTA. The ToR serves as a foundation for an FTA, outlining its scope, regulations, and framework. Meanwhile, a BIT between countries or blocs establishes the rules for promoting and protecting mutual investments for investors.
Sources suggested that if the discussions for a BIT are finalized soon, there may be an opportunity to advance FTA negotiations with the GCC. If delays persist, India is prepared to engage in FTA discussions with GCC members Qatar and Bahrain. India already has an FTA with the UAE, one of the GCC members. The GCC includes Saudi Arabia, UAE, Kuwait, Qatar, Oman, and Bahrain, with Saudi Arabia being the largest member in terms of economic scale, population, and land area, surpassing all other GCC members combined.
In December 2024, government sources indicated to CNBC-TV18 that Saudi Arabia aimed to finalize a BIT with India prior to moving forward with an FTA. However, it was noted that India was not inclined to link the FTA discussions directly with the BIT negotiations with Saudi Arabia, contributing to delays in the FTA discussions.
In 2022, negotiations for the potential FTA, initially proposed in 2004, resumed between India and the GCC after several years of inactivity. The GCC is a significant trading partner for India, fostering historical ties and hosting nearly 1 crore Indian workers. Economic relations between India and the GCC have consistently strengthened, particularly due to the increase in oil imports. For the fiscal year 2023-24, India-GCC bilateral trade reached $161.59 billion, with India’s exports totaling $56.3 billion, while imports amounted to $105.3 billion.
Sources suggested that if the discussions for a BIT are finalized soon, there may be an opportunity to advance FTA negotiations with the GCC. If delays persist, India is prepared to engage in FTA discussions with GCC members Qatar and Bahrain. India already has an FTA with the UAE, one of the GCC members. The GCC includes Saudi Arabia, UAE, Kuwait, Qatar, Oman, and Bahrain, with Saudi Arabia being the largest member in terms of economic scale, population, and land area, surpassing all other GCC members combined.
In December 2024, government sources indicated to CNBC-TV18 that Saudi Arabia aimed to finalize a BIT with India prior to moving forward with an FTA. However, it was noted that India was not inclined to link the FTA discussions directly with the BIT negotiations with Saudi Arabia, contributing to delays in the FTA discussions.
In 2022, negotiations for the potential FTA, initially proposed in 2004, resumed between India and the GCC after several years of inactivity. The GCC is a significant trading partner for India, fostering historical ties and hosting nearly 1 crore Indian workers. Economic relations between India and the GCC have consistently strengthened, particularly due to the increase in oil imports. For the fiscal year 2023-24, India-GCC bilateral trade reached $161.59 billion, with India’s exports totaling $56.3 billion, while imports amounted to $105.3 billion.
First Published: Dec 24, 2025 3:38 PM IST
