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Amid Pakistan's strategic pact with Saudi and sour ties with UAE, India moves to restart trade with GCC | What we know
Within the GCC, the UAE and Saudi Arabia has India's largest trading partners.
Union commerce minister Piyush Goyal on Thursday announced that India will be restarting talks for a free trade agreement with the Gulf Cooperation Council (GCC). This announcement from Piyush Goyal comes just as India sealed two major trade deals - one with the European Union and one with the United States.
GCC is a union of six countries in the Gulf region which includes Saudi Arabia, the UAE, Qatar, Kuwait, Oman and Bahrain. The negotiations with India also come months after Pakistan and Saudi Arabia renewed their strategic partnership.
GCC FTA to boost trade and investments
As per the union commerce minister, the FTA will strengthen the relation between India and the GCC, which "have been trading amongst each other for over 5,000 years".
The BJP leader also stated that there are about 10 million Indians living and working in the GCC region, who in turn help power the economies of these nations.
"It is most appropriate that we now enter into a much stronger and robust trading arrangement which will enable a greater free flow of goods, services, bring predictability and stability to policy, help encourage a greater degree of investments," Goyal added further.
Within the GCC, the UAE and Saudi Arabia has India's largest trading partners.
Pak's pact with Saudi in focus
The restarting of negotiations between GCC and India comes months after Saudi Arabia and Pakistan inked their defence pact.
In September 2025, Saudi Arabia and Pakistan signed a Strategic Mutual Defence Agreement (SMDA), which revitalises an old strategic cooperative arrangement between Islamabad and Riyadh. The signing of this pact also came months after a military stand-off between India and Pakistan under 'Operation Sindoor'.
Also Read | Pak-Saudi defence pact and its implications for India
From May 7 to 10, India and Pakistan were locked in a cross-border stand-off after New Delhi launched a tri-services strike on Pakistan as part of its response to the Pahalgam attack.
On April 22, 2025, 26 tourists were gunned down in Jammu and Kashmir's Pahalgam. Of the 26 killed, 25 were Indians, and one was a Nepali tourist. India accused Pakistan-based LeT off-shoot The Resistance Front for the attack.
Pak-UAE ties on the fence?
Shortly after UAE president Sheikh Mohamed bin Zayed Al Nahyan's visit to India, the United Arab Emirates scrapped a major deal with Pakistan.
As per a report by Express Tribune, the UAE shelved the deal with Pakistan for the management of Islamabad International Airport after it failed to identify a local partner to whom the operations could be outsourced.
"The Pakistani side had sought a clear response from the UAE by sending a final call letter. In response, the UAE conveyed that it was still unable to confirm any nominated entity," sources told the Pakistani daily.
Ties between UAE and Pakistan soured further after Islamabad signed its strategic partnership with Saudi Arabia.
Furthermore, UAE's growing ties with India have also been a thorn in Pakistan's side, especially after Al Nahyan's short but crucial visit to New Delhi.
Also Read | He came, met Modi, left: UAE President's ‘3-hour’ Delhi visit that sparked buzz
Hours after this visit, India and the UAE agreed to enhance cooperation and agreed to double bilateral trade to a target US$ 200 billion by 2032.
