India is going to finalize the terms of reference of its proposed Free Trade Agreement (FTA) with Qatar by October, government sources said on Monday. This indicates a significant step in strengthening bilateral economic ties.
This move comes in the wake of intense diplomatic engagement between New Delhi and Doha following the two nations upgraded relations to a strategic partnership earlier this year. It is forecast that the mooted FTA will provide a platform where increased trade liberalisation, investment flows, and economic cooperation can be secured between Qatar and India.
Both sides have been working together to ensure that the deal ends up as the path to the end, that is, the ambitious goal of doubling the two-way trade to USD 28 billion within the next 5 years.
In February, Prime Minister Narendra Modi and Amir Sheikh Tamim Bin Hamad Al-Thani held a top-level negotiation in New Delhi, which underlines the importance of the India-Qatar relationship in the very dynamic global economic landscape.
The former established a strategic partnership between the two countries, providing the nations with a broad framework to cooperate on key areas. Over-emphasis on Ties and turning it into a strategic partnership.
The second agreement was tantamount to an upgrading of the Double Taxation Avoidance Treaty, intended to facilitate investment flows, reduce taxation-related hurdles, and instill greater confidence among enterprises on both sides. Deepening the ties to a strategic partnership is supposed to form the foundation of even larger interaction in the field of energy, technology, trade, and cultural relations, and enhance the level of political and security coordination.
Five memoranda of understanding (MoUs) were inked during the visit and across different areas. These included ones on how best to deal with archives, co-operation in youth affairs and sporting events and strengthening economic partnership.
The agreements are a reflection of mutual interest to not only enhance trade and investment, but also enhance people-to-people relations and cultural exchange. One of the key economic outcomes of the visit was that the Qatar Investment Authority (QIA) agreed to open an Indian office.
This will presumably divert a large number of Qatari investments into infrastructure, technology, renewable energy and manufacturing. Indian companies, in return, will have potential access to the expanding economy of Qatar, particularly for services and digital technologies.
Also announced as a fillip to the growing digital payments ecosystem in India was the launch of India Unified Payments Interface (UPI) in QNB Point of Sale terminals. The move will facilitate easier transactions for Indian expats and tourists in Qatar, as well as help with greater cooperation in fintech.
In addition, Qatar National Bank also said it plans to set up an office in the International Financial Services Centre (GIFT City) in Gujarat, as the first move towards further penetrating India’s financial sector. This initiative will target enhancing the cultural diversity of both nations, making them understand one another and promoting the principles of diversity, hospitality, and openness. On the basis of Energy and People-to-People Relations.
Traditionally, energy has been the key to the relationship between India and Qatar, and Qatar is one of the largest suppliers of liquefied natural gas (LNG) to India. Energy security, diversification of the supply chain and long-term cooperation in oil and gas were the top items on the agenda.
India, being an importer of most of its LNG from Qatar, identifies Doha as a vital partner in sources of stable and reliable energy streams in the context of global uncertainties. It also centres on people-to-people ties because there are nearly 800,000 Indians in the nation working and living in Qatar. They represent one of the largest expatriate communities in the Gulf state and contribute their numbers to the development of Qatar, and at the same time, play a crucial role in economic and cultural exchange.
The two leaders unveiled the significance of the Indian diaspora towards the improvement of bilateral relations as well as the confirmation of their interest in their welfare. Prospective: October as a Key Month. The soon-to-conclude terms of reference to the planned India-Qatar FTA in October is a sign of how seriously both sides are taking their economic tie.
Government officials have indicated that the agreement, once settled, will reduce tariffs and improve market access, alongside opening up investment partnerships and joint ventures as well as collaboration in new markets like green energy, fintech, and advanced technology.
The FTA is also expected to provide an overdue institutionalisation of economic cooperation to provide a sense of stability, predictability. It is seen that India is seeking FTAs with members of the Gulf Cooperation Council (GCC) as part of its overall policy of diversifying trade relationships, reducing dependence on traditional markets, and becoming more directly a participant in the high-growth economies of the Middle East.
The Ministry of External Affairs (MEA) described the talks between Prime Minister Modi and the Amir as a deepening of the centuries-old and traditional friendship of the two countries. Its emphasis on trade, investment, technology, energy, and people-people connections is indicative of the multi-faceted nature of the partnership.
As India and Qatar are set to go one step ahead as they settle the terms of the FTA in October, the bilateral partnership is set to go further with the promise of economic dividends, cultural dialogue, and strategic cooperation in equal proportion. Once this accord is reached, it can become a new chapter in Indian engagement with the Gulf to reemphasize the centrality of India as a trustworthy ally in economic and geopolitical affairs.
