Strengthening Strategic Partnership Between Saudi Arabia and India Relations

The kingdom of Saudi Arabia shares cordial and bilateral relations with the Republic of India, dating back to 1947. In current times, the partnership between these two nations has only strengthened with the kingdom catering to India’s high energy demands. In figures, Saudi Arabia fulfills nearly 18% of India’s crude oil requirement and 30% of the LPG requirement. Saudi Arabia holds the fourth position ins India’s trade partner list, just behind China, the USA, and Japan.

Saudi and India Relations Trade Figures

In 2019, both Saudi and India witnessed high profile political visits with Crown Prince Mohammed bin Salman visiting India in February and Prime Minister Narendra Modi touring the Kingdom in October. These two tours are testimonials to the first visit of the Indian Prime Minister to Saudi in 2016 that established the cornerstone of the strengthening ties between the Kingdom and India. The trade deals between these two world powers have been rising by enormous numbers since this visit.

In the FY2015-16, exports from Saudi Arabia to India amounted to $20.32 billion, and imports were calculated at $6.39 billion. The following financial year saw a slight decrease in exports and imports; the amounts were calculated as exports from Saudi Arabia at $19.94 billion and imports to the kingdom at $5.13 billion. However, since then, trade has only increased in number. The FY2017-18 saw exports from the kingdom at $22.06 billion and imports at $5.41 billion. Overall, the bilateral relation reached to the trade reached US$27.48 billion in the financial year 2017–18, up from US$25.1 billion in the preceding year. The same amount surged by 2.61% in FY2018-19, showing the exports from Saudi as $28.48 billion and imports at $5.55 billion.

The recent figures of FY2019-20 sit at bilateral trade relation between India and Saudi valued at the US $33.07 billion. The year saw India’s imports from Saudi Arabia reach $26.84 billion, and exports to the kingdom read worth $ 6.24 billion, showing an increase of 12.18% over the last year.

Saudi Arabia’s Investment in India and Indian Companies

As of March 2020, as per the official data published by the Saudi Arabian General Investment Authority (SAGIA), the state has 476 Indian companies either registered as joint ventures or 100% owned entities worth S$ 1.5 billion. These companies cover diverse industry sectors, ranging from management and consultancy services, construction projects, telecommunications to information technology, financial services, software development, and pharmaceuticals. While major brands, including L&T, TATA, Wipro, TCS, TCIL, and Shapoorji & Pallonji, have established a strong foothold in Saudi, start-ups such as OYO, Delhivery, Firstcry, Grofers, Policy Bazaar, and Paytm are in talks to initiate their operations.

Saudi Arabia is also one of the critical investment partners to Indian brands and start-ups. It had made a strategic investment in Indian start-ups, such as OYO, Delhivery, Firstcry, Ola, Grofers, Policy Bazaar, and Paytm. As per the Department for Promotion of Industry and Internal Trade (DPIIT), India, the kingdom sits at the 39th position as the largest investor in India, with investments worth $315 Million.

Saudi and India Relationship Boost Under Vision 2030

Apart from the ongoing and ever-increasing trade deals between the two nations, another strategic partnership has been laid down by Saudi under its Vision 2030 initiative. As India was confirmed as one of the Kingdom of Saudi Arabia’s strategic partners, the latter gifted the former with a $100 billion investment, an increase in Hajj quota from 170,000 to 200,000, and the release of 850 Indians held in Saudi prisons for minor offenses.

Over the years of their relation, Saudi and India have garnered each other’s trust and respect to continue with their vision to boost their nation’s economy and contribute to one another’s betterment. While earlier the trade deals and partnership were limited to energy and oil exports, it has expanded to include investment, healthcare, R&D, and many other aspects that benefit both Saudi Arabia and India.

Explore more on both the countries’ relationship here.

Related Case Study: Indians in the Kingdom of Saudi Arabia

Ritika
An Engineer by education, and a writer by profession, Ritika lives her life in stories. Her never-ending love for narratives encouraged her to turn her passion into a profession. In more than 4 years of working as a content writer, she has contributed to building content for a reputed technology magazine and a few start-ups.

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