India and GCC countries are set to relaunch free trade agreement talks after a two-decade gap, aiming to boost trade and investment ties.
India and the six-member Gulf Cooperation Council (GCC) are set to formally relaunch negotiations for a Free Trade Agreement (FTA), more than two decades after the first attempt was initiated. The two sides are scheduled to sign the Terms of Reference (ToR) for the proposed agreement, marking the official start of negotiations.
The ToR will outline the framework, scope, objectives and procedural roadmap for the talks. Its signing represents the first formal step towards renewed FTA negotiations between India and the GCC, which includes Saudi Arabia, the United Arab Emirates (UAE), Oman, Qatar, Bahrain and Kuwait.
Significance for Textile and Apparel Trade
The GCC is a key trade and economic partner for India, particularly for the textile and apparel sector. Apparel exports from India to the GCC stood at US$ 1.79 billion in 2024–25, underlining the region’s importance for Indian exporters.
India has already concluded free trade agreements with individual GCC members such as the UAE and Oman, and discussions are underway with Qatar to prepare the ground for formal negotiations. With Bahrain, draft ToR have been exchanged for the launch of talks on a Comprehensive Economic Partnership Agreement (CEPA).
Revival of a Long-Pending Initiative
The renewed push for a comprehensive India–GCC FTA revives an earlier effort that began in August 2004, when both sides signed a Framework Agreement on Economic Cooperation. This led to two rounds of FTA negotiations in 2006 and 2008. However, the process was stalled in 2009, when the GCC suspended negotiations with all trading partners.
Trade, Investment and Strategic Importance
Among GCC members, the UAE is India’s largest trading partner, with apparel trade valued at US$ 1.22 billion in FY 2024–25, followed by Saudi Arabia at US$ 360.11 million during the same period. The GCC region is also a major source of foreign direct investment (FDI) into India, with cumulative inflows of around US$ 31 billion between April 2000 and September 2025.
The formal relaunch of FTA negotiations is expected to deepen economic integration between India and the Gulf region, with potential benefits for trade expansion, investment flows and labor mobility, while offering new growth opportunities for sectors such as textiles and apparel.