Buyer-seller to strategic partners : India-Saudi Arabia Buyer-seller to strategic partners : India-Saudi Arabia

Headlines

aviation-defence-universe

Buyer-seller to strategic partners : India-Saudi Arabia changing dynamics

Hits 337

By Jai Kumar Verma

Indian Prime Minister Narendra Modi

New Delhi. 03 November 2019. When the Indian Prime Minister Narendra Modi returned recently after paying a two days official visit to Saudi Arabia, all eyes specially Pakistan’s were on the bonhomie and warmth between the leaders of the two important nations not only for the continent but also for the world.

It was a second visit of Modi to Saudi Arabia in last three years and the visit was important both symptomatically as well as substantially. The global focus was because not only is Saudi one of the most important Muslim country in the world but is also a perpetual saviour of Pakistan.

The visit was also crucial because Saudi Arabia is India’s second-biggest supplier of oil while Iraq is the largest oil supplier. India is world’s third biggest oil consumer and it produces only 17 percent of oil indigenously. Saudi Arabia supplied 40.33 million tonnes of crude oil in 2018-19 and 200,000 tonnes of LPG every month to India. Saudi Arabia has emerged as fourth biggest trading partner of India, as in 2017-18 the bilateral trade was $27.48 billion.

However, the basic object of the visit was to upgrade the relationship from buyer-seller connection to the strategic association. Modi government is pursuing an aggressive policy of collaboration with regional powers like UAE, Saudi Arabia and Israel to attract the investments. Modi has visited eight middle eastern countries and territories w.e.f. 2014 as it is visualised that in 2024 India’s demand for oil will surpass China’s requirement.

Saudi Arabia under crown Prince Mohammed bin Salman (MBS) also wants to expand its relationships with important countries of the world including India. MBS is aware that the economy of the country cannot remain dependent on oil for a long time as the researches are working hard to find the substitutes of oil. US has already found unconventional shale oil and vigorous work is going on to utilise renewable energy. Hence MBS wants to invest money in developing countries in manufacturing sectors, technology especially information technology and growing service sector. India is reforming itself and climbed 23 points and reached at 77th place in the World Bank’s ease of doing business index in 2019. India is strong in information technology and also working hard to improve its service sector. 

Prime Minister who had gone to Saudi Arabia on the invitation of King met Saudi king Salman bin Abdulaziz Al-Saud and both of them criticised terrorism and appreciated the increasing cooperation between both the countries on several matters including security matters. He also had fruitful meetings with Crown Prince Mohammed bin Salman (MBS), Foreign Minister, Energy Minister, Labour and Social Development Minister, Environment and Agriculture Minister. Both countries signed 12 agreements and MOUs on different fields including defence industries collaboration, cooperation on renewable energy, prevention of narcotics trafficking, cooperation on Haj related matters, RuPay card, security cooperation etc.

Prime Minister Modi also delivered the keynote address at Future Investment Initiative (FII), which is also known as ‘Davos in the desert’. In his speech he narrated several reforms India took and also talked about his vision of $ 5 trillion economy. Besides touching regional and international issues he made it clear that India intends to invest $ 100 billion by 2024 in oil sector especially on refining, pipelines and gas terminals. Saudi firm Aramco has agreed to invest in West Coast Refinery Project which will be biggest refinery in Asia.

Both countries have also signed an agreement to constitute a ‘Strategic Partnership Council’, which was headed by Prime Minister Modi and King Salman. The council which would enhance the strategic partnership is significant as India signed this agreement with only three countries before namely Germany, Russia and Japan.

The timing of the visit was important as India defanged article 370 of the constitution in August 2019, which granted special status to J&K. Pakistani leaders and generals gave erroneous impression to the semi-literate masses in the country that they would merge J&K in Pakistan, issued strong statements about Kashmir. They also tried to take Kashmir issue in world forums but got very little success. The Organisation of Islamic Cooperation (OIC) and other Muslim countries had also not extended any support to Pakistan. In fact, Pakistan was saved by China, Turkey and Malaysia in The Financial Action Task Force (FATF). MBS took a positive approach and warned Pakistan not to worsen the situation. 

Pakistan Prime Minister Imran Khan is facing lot of resentment in the country. It is reported that about 12 army generals are opposing Pakistan army chief General Qamar Javed Bajwa as he took three years extension by which the career of several generals have doomed. These generals are covertly supporting the Azadi March launched by the Jamiat Ulema-e-Islam leader Fazal-ur-Rehman (JUI-F). In view of massive opposition in the country Imran Khan issued several anti-India and pro Kashmir statements but he could not achieve any success. He unilaterally downgraded ties with India, refused to give permission to Modi’s plane to use Pakistan airspace etc.

The performance of Indian business community which accompanied Modi was also very impressive and were able to convince Saudi entrepreneurs. Saudis can invest in diverse fields including infrastructure, as India needs massive investments. Both countries may have bilateral cooperation in information technology, education, medicine and green energy. Saudis can utilise Indian technical knowhow and trained manpower and can invest money which will not only be safe but grow steadily.  

The visit is also important as Saudi Arabia is considered as ‘home of Islam’ and is also the custodian of the holy mosques located in Mecca and Medina. India has about 201 million Muslims and has world’s second-largest Muslim population. Inter Services Intelligence (ISI) of Pakistan has launched special operations to radicalise Indian Muslims especially in J&K.

Indian Prime Minister Narendra Modi

If India develops cordial relations especially on security and strategic fields with Saudi Arabia it will diminish ill effect of Pakistan anti-India rhetoric. Saudi Arabia may not assist Pakistan if it will continue helping terrorist outfits in India in carrying out terrorist activities. MBS and other Saudi leaders have already issued statements against terrorism. Both sides discussed regional and global issues and rejected any type of interference in the internal affairs of other country. Although no name was mentioned but it was an implied reference of Pakistan.  

Delhi signed a treaty with Muscat that Indian Navy can utilise strategic port of Duqm. MBS in his latest visit promised to share intelligence pertaining to terrorism with India. Saudis also made a big investment in India by purchasing a 20 percent stake in Reliance Industries’ oil and chemical business.    

Although India is purchasing oil from Middle Eastern Countries and millions of Indians are working in Gulf countries but India’s relationship with these countries was superficial. These countries have also not invested much in India. Nevertheless, after Modi came to power his government made sincere efforts to attract investment in India. He was able to cultivate strong links with crown princes of Saudi Arabia and UAE. The Middle Eastern states also showed interest in India as well as in investments. The relationship between India and middle eastern countries especially with Saudi Arabia and UAE will be strengthened. It will also be a big jolt to Islamabad and the possibility that Pakistan reduces its anti-India activities cannot be ruled out completely.  

(Jai Kumar Verma is a Delhi-based strategic analyst and a retired senior intelligence officer. He is also member of United Services Institute of India and Institute for Defence Studies and Analyses. The views in the article are solely the author’s. He can be contacted at editor.adu@gmail.com)

Tagged with: , , , , , , , , , , ,

Related Articles