The meeting with the investment group ushers in a new era for trade relations between India and Saudi Arabia
RIYADH: Trade and economic relations between India and Saudi Arabia have taken another step forward after the countries' inaugural High Level Group on Investment was held earlier this week.
The body was established in 2023 when the kingdom's Crown Prince Mohammed bin Salman paid an official visit to the Asian nation — a visit that came four years after he pledged $100 billion worth of investment in India during a trip to New Delhi.
The first meeting of the working group was held virtually on July 30 and was chaired by Saudi Energy Minister Prince Abdulaziz bin Salman and PK Mishra, Principal Secretary to Indian Prime Minister Narendra Modi.
During the call, India invited Saudi Arabia's Public Investment Fund to set up an office in the Asian nation as it seeks to attract funds from the kingdom.
“Constructive discussions were held on various opportunities for bilateral investment in various areas of the public and private sectors, including refining and petrochemicals, new and renewable energy, power, telecom, innovation, among others,” India's Prime Minister's Office said in a statement after the meeting in the high-level working group.
The statement further stated that an empowered delegation led by the country's petroleum secretary will visit Saudi Arabia for follow-up discussions on the mutually beneficial investment in the oil and gas sector.
Both countries also agreed to regular consultations between their technical teams to advance discussions and reach agreement on specific investments.
India also invited the Saudi energy minister to visit New Delhi for the next round of high-level task force meetings.
Crown Prince Mohammed bin Salman, Indian President Ram Nath Kovind, center, and Indian leader Narendra Modi at a ceremonial reception in 2019. (AFP)
India and Saudi Arabia: A history of long-standing relations
Although India and Saudi Arabia have shared strong economic and trade ties since 1947, their bilateral relations took a new turn after the signing of the Delhi Declaration in 2006.
It was followed by the Riyadh Declaration in 2010 when then Indian Prime Minister Manmohan Singh visited Saudi Arabia, which elevated the bilateral relationship to a strategic partnership between both nations.
Later, Modi's visit to Saudi Arabia in 2016 captured the spirit of enhanced political, economic, security and defense cooperation between Riyadh and New Delhi.
When the Crown Prince visited India in 2023, on the sidelines of the G20 summit and to co-chair the first leaders' meeting of the India-Saudi Arabia Strategic Partnership Council, both countries signed eight agreements in several areas, including energy, banking. , and investment, as well as manufacturing, archival cooperation, anti-corruption and water desalination.
Apart from the growing economic and trade ties, India and Saudi Arabia also share a strong emotional and cultural relationship, with the Kingdom being the most sought-after destination for Indian talent and religious tourists.
Data from the Indian embassy in Riyadh revealed that more than 2.65 million Indians live in Saudi Arabia, which acts as a “living bridge between the two countries.”
The embassy also added that cultural cooperation between India and Saudi Arabia has also expanded in the new fields of film and entertainment, sports activities like cricket and football and tourism exchange in recent years.
Latest trade statistics between Saudi Arabia and India
According to data from India's Consulate General in Jeddah, Saudi Arabia is the Asian country's fourth largest trading partner, while India is the kingdom's second largest trading partner.
The Consulate General of India also acknowledges that Saudi Arabia is not only a trading partner, but an “important pillar of its energy security and an important economic partner for investments, joint ventures and transfer of technology projects.”
Data from the General Authority for Statistics reveals that Saudi Arabia's exports to India in 2023 totaled SR 113.35 billion ($30.20 billion), while the kingdom's imports to the Asian nation totaled SR 43.57 billion.
In 2023, Saudi Arabia was the third largest exporter of crude oil to India, amounting to 39.5 million tonnes, accounting for 16.7 percent of the country's total oil imports.
Another report released by GASTAT in July noted that Saudi Arabia's outbound shipments to India were worth SR8.03 billion in May.
In terms of non-oil exports, the Kingdom exported goods worth SR2.23 billion in May, with chemical and related products topping the list with shipments worth SR1.27 billion.
Saudi Arabia also exported plastic and rubber products to India totaling SR448 million in the same month, while outbound shipments of base metals accounted for SR347.8 million.
On the import side, shipments worth SR 3.54 billion from India reached Saudi Arabia in May.
Mechanical equipment and electrical appliances were the most imported goods from India to the Kingdom in May, totaling SR886.1 million.
During the same month, India exported chemical and allied products worth SR 470.4 million, followed by plant products and base metals at SR 580.3 million and SR 342.2 million, respectively.
Developments in the tourism sector
Apart from trade relations, India and Saudi Arabia also have strong ties in the tourism sector.
Over 1.5 million Indian tourists visited the kingdom in 2023, representing a 50 percent increase over the previous year, according to the Saudi Tourism Authority.
In an effort to increase the number of Indian tourists visiting the Kingdom, STA organized networking events in Mumbai, Ahmedabad, Bengaluru and Delhi and interacted with travel industry organizations in February.
STA, as part of its broader tourism strategy, aims to bring in 7.5 million Indian visitors over the next seven years.
Data from the Indian Ministry of External Affairs reveals that more than 170,000 Indian pilgrims performed the Hajj in 2024, marking a significant increase from 139,000 and 57,000 in 2023 and 2022, respectively.
Air links between Saudi Arabia and India have also increased by 31 percent between 2019 and 2023. Flights now connect 12 major hubs in India with Saudi cities including Riyadh, Jeddah and Dammam.
The growth of Saudi Arabia as a global tourist destination is fueled by the kingdom's megaprojects such as NEOM, along with developments in the areas around Alula, Diriyah and the Red Sea.
India is also emerging as a favorite destination for tourists from Saudi Arabia.
A report released by travel app Wego in July revealed that Saudi Arabia emerged as the top five sources for travelers from the Middle East region to India.
The analysis noted that routes from Riyadh to New Delhi and Riyadh to Lucknow were the most popular among travelers in the Middle East in the first half of this year.
“The findings indicate a dynamic travel landscape where India remains a key destination for both leisure and business travelers from around the world, driven by various factors such as tourism, business ventures and family connections,” said Bernard Corraya, general manager of the Wego India office.
