India, Qatar to Double Trade to $28BN in Next Five Years

Relevance: GS 2 – Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests

Why in the News?

  • India-Qatar Trade Expansion: India and Qatar have agreed to double bilateral trade to approximately $28 billion over the next five years.
  • Diversification Beyond Hydrocarbons: Piyush Goyal emphasized that while India and Qatar share a strong history of energy trade, their future partnership will extend beyond hydrocarbons.
  • QIA’s Increased Investments: The Qatar Investment Authority (QIA) has proposed to enhance its investments in Indian sectors such as Infrastructure projects, Smart cities, Food parks, Startups and Emerging technologies, including artificial intelligence, robotics, and machine learning.

India, Qatar to Double Trade to $28BN in Next Five Years

India-Qatar Business Forum Highlights

Historic Partnership & Future Vision

  • India and Qatar share a long history of successful energy trade.
  • Future collaboration will expand beyond hydrocarbons to emerging sectors.
  • The partnership will focus on sustainability, technology, entrepreneurship, and energy.

Key Remarks by Minister Piyush Goyal

  • India and Qatar can complement each other’s strengths in innovation and industry.
  • The nations are undergoing transformational changes, paving the way for new opportunities.
  • India’s economy is dynamic and resilient, offering promising prospects for Qatari investments.
  • Proposed the creation of a joint working group to explore mutual areas of interest.

State Visit of the Amir of Qatar

  • Sheikh Tamim Bin Hamad Al Thani is on his second state visit to India (February 17-18, 2025).
  • Prime Minister Narendra Modi personally welcomed the Amir at the airport, symbolizing strong ties.
  • Significant growth in bilateral trade and investments is expected in the coming days.

India-Qatar Business Forum

  • Held in New Delhi on February 18, 2025.
  • Inaugural session attended by Commerce & Industry Minister Piyush Goyal and Qatari Minister Sheikh Faisal bin Thani bin Faisal Al Thani (Guest of Honour).
  • Organized by:
    • Confederation of Indian Industry (CII)
    • Department for Promotion of Industry and Internal Trade (DPIIT)

Key Takeaways

  • Energy partnership to evolve with a focus on sustainability and new-age industries.
  • Entrepreneurship and technology identified as core drivers of future collaboration.
  • Qatar invited to explore investment opportunities in India’s growing economy.
  • Joint initiatives and business collaboration to be strengthened.

India-Qatar Economic and Trade Relations

Qatari Minister’s Remarks

  • Sheikh Faisal bin Thani bin Faisal Al Thani emphasized mutual respect, shared interests, and strong economic cooperation between India and Qatar.
  • The relationship is built on long-standing trade and investment partnerships.

Bilateral Trade (2023-24)

  • Total Trade Volume: Over $14 billion.
  • India’s Imports from Qatar:
    • Liquefied Natural Gas (LNG)
    • Liquefied Petroleum Gas (LPG)
    • Petrochemicals
    • Plastics
    • Aluminum articles
  • India’s Exports to Qatar:
    • Agricultural products: Cereals, vegetables, fruits, spices, processed food.
    • Industrial goods: Copper, iron & steel, chemicals, textiles, construction materials.
    • Technology & machinery: Electrical equipment, plastic products.
    • Other commodities: Precious stones, rubber.

Qatari Investments in India

  • Total FDI from Qatar: Over $1.5 billion across sectors such as Telecom, Retail, Education, Healthcare, IT, Power and Affordable housing

Recent Investments by Qatar Investment Authority (QIA)

  • $1 billion in Reliance Retail Ventures Limited (RRVL) – August 2023.
  • $393 million in IndoSpace Logistics Parks – September 2023.
  • $50 million in Global Dental Services – November 2023.
  • $140 million in Shriram Housing Finance Ltd – January 2025.
  • $450 million for 25.1% stake in Adani Transmission Ltd’s unit – February 2020.

Indian Investments in Qatar

  • $356 million invested between 2017-2025 by companies like Larsen & Toubro, Voltas, Shapoorji Pallonji, Wipro, TCS and Tech Mahindra.

Strategic Trade Agreements

  • LNG & LPG Supply: Qatar is India’s largest supplier, providing:
    • 91 MMT of LNG (46% of India’s LNG imports in 2023-24).
    • 92 MMT of LPG (26% of India’s LPG imports in 2023-24).
  • Long-Term LNG Contracts:
    • 1999: QatarGas & Petronet LNG signed a deal for 7.5 MMTPA LNG supply until 2028.
    • February 2024: New agreement between QatarEnergy & Petronet LNG extended the deal up to 2048 (valued at $78 billion).
    • December 2024: GAIL signed an agreement with QatarEnergy for 60 cargoes over five years.

Upcoming Collaborations

  • India-Qatar Business Delegation aims to strengthen trade partnerships.
  • Qatar’s participation in Startup India Mahakumbh 2025 (April 3-5, 2025) to enhance startup investments in India’s technology & innovation sector.

Way Forward for Strengthening India-Qatar Economic Partnership

Diversification of Trade and Investment

  • Expand trade beyond hydrocarbons to technology, fintech, and manufacturing.
  • Promote investments in renewable energy, infrastructure, and digital economy.

Strengthening Energy Security

  • Ensure long-term energy agreements for stable LNG and LPG supplies.
  • Explore joint ventures in green hydrogen and renewable energy projects.

Enhancing Bilateral Investments

  • Facilitate greater Qatari investments in Indian startups, infrastructure, and industrial corridors.
  • Encourage Indian companies to expand operations in Qatar through policy incentives.

Promoting Entrepreneurship and Innovation

  • Leverage platforms like Startup India Mahakumbh to attract Qatari investment in Indian startups.
  • Establish joint incubation centers for fostering innovation and business collaborations.

Strengthening Institutional Frameworks

  • Set up a Joint Working Group for trade, investment, and economic cooperation.
  • Enhance collaboration between CII, DPIIT, and Qatari business forums.

Infrastructure and Connectivity

  • Improve maritime and air connectivity for smoother trade and logistics.
  • Collaborate on port development and logistics hubs to facilitate supply chain efficiency.

Cultural and Human Resource Exchange

  • Strengthen ties in education, healthcare, and skill development.
  • Facilitate easier visa and labor mobility policies for professionals and workers.

Strengthening Geopolitical and Strategic Cooperation

  • Align India-Qatar relations with regional and global economic trends.
  • Enhance coordination in multilateral forums like WTO, G20, and UN.

Source

https://www.hindustantimes.com/india-news/india-qatar-to-double-trade-to-28bn-in-next-five-years-101739902852505.html

Mains question

Discuss the evolving economic partnership between India and Qatar. How does this relationship align with India’s energy security and economic priorities? (250 words)