Arab Connect: New Dimensions To India's Millennia-Old Partnership

India’s political ties with the Arab World have been unique and strong, even though Pakistan has often tried to claim a sub-continental legacy. People-to-people ties are based on civilisational links. It is an economic partnership that has not matured in keeping with the requirements of the modern era and aspirations of the youth. However, in the region, India’s ties with Israel have acquired momentum, riding on technology and innovation. This required both New Delhi and the Arab states to realise that new pillars must be created to strengthen the millennia-old partnership.

India-Arab Partnership Conference

To further deepen strong trade and investment links between India and the Arab States, provide better connect among the traders of the two sides, enhance cooperation among small and medium enterprises, and forge investment linkages, the two sides decided at their New Delhi meeting to organise the India-Arab Partnership Conference every two years alternately in one of the Arab Member States and India, to intensify the trade and investment links. 

The Partnership Conference would be led by the Commerce and Industry Ministries of India and the Arab States, accompanied by business delegations. The participation of relevant businesses would be coordinated by identified Chambers of Industry from both sides and the Secretariat of the League of Arab States. The deliberations would focus on policy decisions, investment opportunities, recommendations by the businesses for better market access, and joint venture collaborations. 

Improving Trade

It was decided to double trade between India and the Arab states to $500 billion by 2030, from the current trade of $240 billion, and encourage joint programmes to enhance the competitiveness of small- and medium-sized enterprises, facilitate their access to markets, and support training and capacity-building initiatives for SME development agencies. 

The two sides also decided to promote the exchange of expertise, capacity building, and knowledge transfer in the field of SME development, contributing to enhanced competitiveness and job creation, through joint programs for training, technical support, and skills development. To facilitate bilateral trade, it was decided to reduce reliance on foreign currencies, lowering transaction costs and enhancing financial flexibility. India proposed conducting technical consultations among the relevant financial authorities, with the participation of Arab central banks, to examine implementation methods and operational frameworks.

For the next generation economic partnership, the meeting explored ways to enhance cooperation in the field of digital payment systems, including examining the possibility of technical integration between national payment systems in India and the Arab League member states, voluntarily and in accordance with the legislation and monetary and financial policies in force in each country.

Enhancing Cooperation

The two sides have also decided on enhanced cooperation aimed at energy security, support for renewable energy and energy efficiency, the promotion of the green transition, and clean energy technologies, and enhance bilateral trade in hydrocarbons between India and the member states of the League of Arab States, besides facilitating reciprocal investment across the oil and gas value chain, including exploration, production, and strategic petroleum reserves.

It was decided to explore joint ventures in solar parks and wind farms, leveraging India’s experience with large-scale renewable energy deployment and the priorities of India and the Arab States. It was also decided to encourage the coordination of efforts to mobilise joint financing for renewable and new energy projects through collaborative partnerships between India and the Arab states and to facilitate collaboration in R&D, production, and supply chains for green hydrogen and ammonia.

Beyond the traditional sources of energy, it was decided to encourage cooperation in clean technology and infrastructure:

• Carbon Capture & Storage (CCS): Joint research and pilot projects in decarbonising fossil fuel operations 
• Smart Grid & Battery Storage: Technology sharing and co-development in grid stability, EV charging infrastructure, and energy storage systems 
• Adoption of biofuels

Further, the two sides decided to collaborate in capacity development in the energy sector in solar panel installation, grid management, and green technologies through institutions like the Skill Council for Green Jobs. An area which received limited attention in the India-Arab discourse, except for the India-UAE partnership, has been digital technologies and startups. For the first time, the Arab States decided to reciprocate to India’s growing expertise and demands, which will also meet the aspirations of the Arab youth.

Digital Collaboration 

It was decided to promote cooperation in digital technologies, which include initiatives in AI applications, besides innovation, and startups, while respecting state sovereignty, data privacy, and security, and ensuring compliance with relevant national laws and regulations, and in alignment with national and regional Arab strategies on digital transformation.

The two sides agreed to link startup ecosystems in India and the Arab states, explore market opportunities and access in both regions, including the exchange and analysis of non-sensitive information on priority markets and sectors, and supporting market entry for startups in accordance with applicable laws and regulations, while safeguarding data privacy and security.

It was decided to establish joint projects and partnerships between startups based on complementary technical and innovative capabilities, ensuring intellectual property protection, data governance, and compliance with national regulatory and legislative frameworks. 

It was decided to facilitate access to investments through transparent and secure mechanisms connecting startups with investors and funding sources, ensuring compliance with financial regulations.

Startup Ecosystem 

The priority sectors identified include health technologies, financial technologies, agri-tech, green technologies, and others, in line with Arab States’ developmental priorities and sectoral legislation, ensuring the highest standards of data protection, privacy, and security, particularly for health, financial, agricultural, and environmental data.

It was decided to establish an India-Arab Startup and Innovation Partnership Platform to implement joint programmes, facilitate investment access, support seamless startup integration, and provide capacity-building programmes offered by the ‘Start-Up India’ initiative to startups from other States. 

Sharing Best Practices

An India-Arab Space Cooperation Working Group would also be set up to study the feasibility of encouraging cooperation in joint remote-sensing missions for climate, agriculture, urban planning and disaster management; space research, capacity building and academic exchange programmes; inclusion of private- sector entities in launches, satellite development, and data service delivery; capacity building of scientists/engineers from Arab States at Indian space research centers and universities.

The outcomes of the India-Arab Ministers' meeting have opened a plethora of opportunities, building on the extraordinary political ties built over centuries. While building on the relationship with Israel, New Delhi needs to equally focus on the Arab World, which is home to a big market and an aspiring population seeking a wider partnership with the world’s fourth-largest economy.

(The writer is a commentator on geopolitics and geoeconomics. Views are personal.)