GCC and India Launch Free Trade Agreement Talks: Implications for Investors and Businesses in Oman
India and GCC Launch Free Trade Agreement Negotiations
India and the Gulf Cooperation Council (GCC) officially commenced negotiations for a comprehensive Free Trade Agreement (FTA) on Tuesday with the signing of a Joint Statement in New Delhi, as reported by Indian media.
The Joint Statement was signed by India’s Minister of Commerce and Industry, Piyush Goyal, and GCC Secretary General Jasem Mohamed Albudaiwi. Minister Goyal highlighted that this signing, along with the Terms of Reference for the FTA established earlier this month, represents a significant advancement in India’s economic relations with GCC nations. He emphasized that the proposed agreement would enhance the long-standing historical, cultural, and commercial connections between the two regions.
In a time of global economic uncertainty, the initiation of negotiations for a robust and mutually beneficial trade arrangement was described as timely by Goyal. He noted that the FTA aims to leverage the complementarities between the Indian and GCC economies.
Secretary General Albudaiwi remarked that the FTA would play a pivotal role in reinforcing trade and investment ties, providing businesses on both sides with greater predictability and certainty.
The potential of this agreement to boost trade is substantial. The GCC is India’s largest trading partner bloc, with bilateral trade totaling $178.56 billion for the fiscal year 2024–25. India’s exports to the GCC region were valued at $56.87 billion, while imports reached $121.68 billion. The GCC accounts for over 15% of India’s total global trade.
In the past five years, trade between India and the GCC has experienced an average annual growth rate of 15.3%.
India’s primary exports to the GCC include engineering goods, rice, textiles, machinery, and gems and jewellery. Conversely, major imports from GCC countries consist of crude oil, LNG, petrochemicals, and precious metals such as gold.
The GCC collectively comprises a market of approximately 61.5 million people and a combined GDP of around $2.3 trillion, positioning it among the top ten global economic groupings. Furthermore, the region serves as a significant source of foreign direct investment for India, with cumulative investments surpassing $31.14 billion as of September 2025.
Special Analysis by Omanet | Navigate Oman’s Market
The launch of negotiations for a comprehensive Free Trade Agreement (FTA) between India and the GCC presents significant opportunities for businesses in Oman to enhance trade and investment. With GCC’s economic clout and India’s growing market, smart investors should explore sectors like engineering goods and petrochemicals that are poised for expansion. However, businesses must also prepare for potential volatility in trade dynamics, ensuring they can adapt to shifts in regional economic landscapes.
