THEBUSINESSBYTES BUREAU
NEW DELHI, FEBRUARY 25, 2026
India and the Gulf Cooperation Council (GCC) have formally kicked off
negotiations for a comprehensive Free Trade Agreement, signalling a major push
to strengthen one of the country’s most significant economic partnerships amid
global trade uncertainties.
The Joint Statement to begin the negotiations was signed in New Delhi by
Union Commerce and Industry Minister Piyush Goyal and GCC Secretary General
Jasem Mohamed Albudaiwi, in the presence of senior officials from both sides.
Describing the move as a decisive step forward, Goyal said the Joint
Statement, read together with the Terms of Reference signed earlier this month,
lays the foundation for a robust and mutually beneficial trade pact. He noted
that the proposed agreement would build on the deep historical, cultural and
commercial linkages between India and the Gulf region while unlocking new
economic opportunities.
At a time of global economic volatility, the minister said, the decision
to launch negotiations was both timely and strategic, allowing the two sides to
leverage their complementary strengths across sectors ranging from energy and
infrastructure to manufacturing and services.
Albudaiwi emphasised that the FTA would enhance predictability and
transparency for businesses, strengthen investment flows and create a more
stable trade environment between the two regions.
The Gulf Cooperation Council is India’s largest trading partner bloc,
with bilateral trade reaching USD 178.56 billion in FY 2024–25. Indian exports
to the GCC stood at USD 56.87 billion, while imports—dominated by crude oil,
LNG and petrochemicals—were valued at USD 121.68 billion. The bloc accounts for
more than 15 per cent of India’s global trade, with overall commerce growing at
an average annual rate of 15.3 per cent over the past five years.
India’s key exports to the region include engineering goods, rice,
textiles, machinery, and gems and jewellery, while gold and energy resources
form the backbone of imports.
Home to about 61.5 million people and a combined GDP of roughly USD 2.3
trillion, the GCC ranks among the world’s top economic groupings and is a major
source of foreign direct investment for India, with cumulative inflows
exceeding USD 31.14 billion as of September 2025.
The nearly ten million-strong Indian diaspora across GCC countries continues to serve as a vital bridge between the two regions, reinforcing people-to-people ties and supporting expanding business linkages
Officials on both sides expressed confidence that the proposed FTA would not only boost trade volumes but also open new avenues in investment, technology collaboration and supply chain integration, marking a new chapter in India–GCC economic engagement.
