India, Gulf bloc discuss next steps on free trade agreement
Indian and Gulf Cooperation Council (GCC) officials met in Riyadh to review the status of Free Trade Agreement negotiations and discuss the next steps in the process.
Discussions covered strengthening bilateral economic relations and regional developments, with both sides reaffirming the importance of continued coordination for regional stability.
The GCC is India's largest trading-partner bloc, with bilateral trade reaching USD 178.56 billion in 2024-25.
Negotiations had formally launched earlier in 2026 with a Joint Statement and Terms of Reference, though the first substantive negotiating round has faced delays linked to regional developments in West Asia.
The Gulf Cooperation Council (GCC)
The GCC is a regional political and economic union of six Gulf Arab states, established to promote unity based on shared political, economic, and cultural objectives. It functions as a customs union among its members and is a key hub for India's energy imports and expatriate workforce.
Key Details
- Established: May 1981, in Riyadh, Saudi Arabia (headquarters remains in Riyadh).
- Members (6): Saudi Arabia, United Arab Emirates, Kuwait, Qatar, Bahrain, and Oman.
- The GCC operates a common external tariff as part of its customs union framework, meaning an India-GCC FTA would negotiate terms applicable across all six states collectively rather than bilaterally.
- India-GCC Terms of Reference for FTA negotiations were signed in February 2026, followed by a Joint Statement formally launching negotiations, signed by India's Commerce and Industry Minister and the GCC Secretary-General.
The Riyadh meeting is a follow-up review under this newly launched negotiation track, working through unresolved issues from earlier attempts (talks were first explored in 2004 and 2008 but stalled over sensitive sectors, labour mobility, and trade imbalance concerns).
India's Gulf/West Asia trade and energy dependence
India's ties with the Gulf region rest on three pillars: energy security (crude oil and LNG imports), remittances from the large Indian expatriate workforce, and merchandise trade. The GCC bloc's position as India's largest trading partner reflects the scale of crude oil imports, alongside growing non-oil trade.
Key Details
- Bilateral trade with GCC: USD 178.56 billion in FY 2024-25, accounting for over 15% of India's total global trade.
- India already has bilateral CEPAs with individual Gulf economies, notably the India-UAE CEPA (2022), which set a template design that GCC-wide talks partly build on.
- Key negotiation areas for the GCC-wide FTA include trade in goods, customs procedures, trade in services, digital trade, SPS measures, IPR, and MSME cooperation.
The Riyadh discussions on "next steps" reflect the practical difficulty of negotiating a single FTA text across a six-member customs union with varying sensitivities, distinct from the bilateral UAE CEPA route India has already used successfully.
- GCC established: May 1981; Headquarters: Riyadh, Saudi Arabia; 6 members.
- India-GCC bilateral trade: USD 178.56 billion (FY 2024-25) — India's largest trading-partner bloc.
- GCC accounts for over 15% of India's total global trade.
- India-GCC Terms of Reference for FTA signed: February 2026; Joint Statement launching negotiations followed the same month.
- India already has a standalone CEPA with the UAE (a GCC member), in force since 2022.