On 28 and 29 October 2019, Indian Prime Minister Narendra Modi paid a visit to Saudi Arabia and met with King Salman bin Abdulaziz al Saud and the crown prince, Mohammed Bin Salman. The Indian Prime Minister also met with Saudi Environment, Water and Agriculture Minister Abdulrahman bin Abdulmohsen Al-Fadley and Labour and Social Development Minister, Ahmad bin Sulaiman Alrajhi. He also held a meeting with the Jordanian King, Abdullah II during the visit in Riyadh.¹

Modi’s last visit to Saudi Arabia was on 2 and 3 April 2016.² In 2018-2019, India’s total exports to Saudi Arabia are at US$ 5,561 million and India’s total imports from Saudi Arabia are at US$ 28,479 million. ³ During the current visit, both states signed 12 Memorandum of Understandings in the area of security, energy, renewable energy, combating illicit trafficking, civil aviation, military acquisition and R&D, medical products regulation etc.

Indian Strategic Petroleum Reserves Limited (ISPR) signed an agreement with Saudi Aramco to build emergency crude oil reserves to safeguard against supply disruptions and unstable oil prices.⁴ Moreover, Vikram Limaye, Managing Director and Chairperson of the National Stock Exchange signed an agreement with the Saudi Stock Exchange. On the foreign policy research level, India’s Foreign Service Institute signed an agreement of cooperation with Prince Saud Al Faisal Institute of Diplomatic Studies. The National Payments Corporation of India (NPCI) also signed an agreement with Saudi Payments to officially launch the RuPay card in Saudi Arabia. The RuPay card is likely to ease financial transactions for the large Indian diaspora working in the Gulf state as well as Haj pilgrims. Saudi Arabia has become the third country after the UAE and Bahrain to implement the RuPay card system.⁵

Modi also attended the 3rd edition of the Future Investment Initiative in Riyadh in which he reiterated India’s commitment to becoming a US$ 5 trillion economy by 2024. He shared India’s enthusiasm to align ‘Make in India’ initiative with Saudi ‘Vision 2030’ initiative and enumerated five key trends that affect global business environment namely technology and innovation; infrastructure; human resources; compassion for the environmental and business-friendly government.⁶

India has emerged as the third-largest start-up ecosystem in the world and the Prime Minister expressed willingness to share the experience with Saudi counterparts. Indian entrepreneurs have penetrated in the transport, tourism and hospitality, medical health, food delivery sectors etc. He appealed to venture capitalists to take advantage of India’s vibrant start-up environment. Modi also stressed that infrastructure is an opportunity multiplier and expressed his commitment to spend US$ 1.5 trillion for infrastructure development in India. He talked about setting up integrated power grid, water grid, gas grid, mobility card, optical fibre network etc. The Prime Minister emphasized on developing quality manpower and the need to re-skill and adopt an approach of learning, unlearning and re-learning the workforce. There is a comprehensive plan of action to provide skills to 400 million Indian youth that would provide assured skilled manpower for foreign firms working in India. He applauded the hardworking, law-abiding Indian diaspora working in Saudi Arabia.

Moreover, international trade agreements, according to PM Modi, should not be limited goods but expanded to manpower mobility. The environment was also a key area during his speech. He elaborated on the importance of clean energy and announced to invest US$ 100 billion by 2024 to build refineries, pipelines and gas terminals across the country. In terms of renewable energy, he mentioned that India would produce 450 gigawatts of energy in the coming years. He appealed to Saudi Arabia to expand its energy relationship to satisfy India’s energy needs. He stressed on minimum government, maximum governance which is conducive for a competitive, innovative, dynamic business environment.⁷ Both states also expressed their joint commitment to accelerate trade and investment under Vision 2030.

One of the most crucial outcomes of the visit was to set up the Strategic Partnership Council between both states. It is the highest bilateral mechanism to encompass all aspects of cooperation in defence and security, diplomacy, economy, people to people contact, culture cooperation etc. which will be directly monitored by the Indian Prime Minister and the Saudi Crown Prince. It has parallel verticals under the Foreign Ministry level and Ministry of Commerce and Industry level and further divided into sub-groups. India has become the fourth state after the United Kingdom (UK), France and China to enter into the Strategic Partnership Council. The mechanism is designed to review the progress of all the agreements signed between both states. Both states have agreed to meet once every two years to track the progress on functional and ministerial level.⁸

Saudi Arabia is keen to diversify its economy and India with its enormous economic potential and large energy market is a viable partner which can benefit both states. Both states have shown their willingness to explore new levels of cooperation which was historically energy-based and the visit of the Indian Prime Minister reflects Saudi Arabia’s policy of de-hyphenating India and Pakistan that was largely pre-occupied by religious and geopolitical considerations. India and Saudi Arabia at present have emerged as strategic partners based on the personal friendship between the Indian Prime Minister and the Saudi Crown Prince as well as shared security and economic interests.

References:

1. The Hindu. “Narendra Modi announces formation of India-Saudi Strategic Partnership Council.” The Hindu. October 30, 2019. Accessed November 1, 2019. https://www.thehindu.com/news/national/india-saudi-form-strategic-council/article29826191.ece
2. Pradhan, P.K. “Modi’s Visit to Saudi Arabia.” IDSA. April 6, 2016. Accessed November 1, 2019. https://idsa.in/idsacomments/modis-visit-to-saudi-arabia_pkpradhan_060416
3. Department of commerce. “Export Import Data Bank: Saudi Arabia”. Department of Commerce. 2019. Accessed November 1, 2019. https://commerce-app.gov.in/eidb/iecnt.asp
4. Chaudhary, D.R. “Indian Strategic Petroleum Reserves, Aramco ink storage lease pact.” The Financial Times. October 30, 2019. Accessed November 1, 2019. https://economictimes.indiatimes.com/industry/energy/oil-gas/indian-strategic-petroleum-reserves-aramco-ink-storage-lease-pact/articleshow/71813821.cms?from=mdr
5. Prime Minister’s Office. “List of MoUs/Agreements signed during the visit of Prime Minister to Saudi Arabia.” Prime Minister’s Office. October 29, 2019. Accessed November 1, 2019. https://pib.nic.in/PressReleasePage.aspx?PRID=1589520
6. Trigunayat, A. “The Saudi visit of Prime Minister Modi –Another milestone in the Act West Policy.” Financial Express. October 30, 2019. Accessed November 1, 2019. https://www.financialexpress.com/defence/the-saudi-visit-of-prime-minister-modi-another-milestone-in-the-act-west-policy/1749941/
7. India Today. “PM Narendra Modi Keynote Address At Future Investment Summit In Riyadh.” India Today. October 29, 2019. Accessed November 1, 2019 https://www.youtube.com/watch?v=s3ONqDJyJbc
8. Mohan, G. “India, Saudi Arabia form highest-level strategic partnership council.” India Today. October 30, 2019. Accessed November 1, 2019. https://www.indiatoday.in/india/story/india-saudi-arabia-form-highest-level-strategic-partnership-council-1613908-2019-10-30

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