Context
• India and the Gulf Cooperation Council (GCC) signed the Terms of Reference (ToR) to begin formal negotiations for a Free Trade Agreement (FTA).
• GCC is India’s largest merchandise trade partner, bigger than the EU and the U.S.
Terms of Reference (ToR) – Prelims basics
• Framework document that defines:
• Scope and objectives of negotiations
• Process and timelines
• Issues to be covered (tariffs, services, investments, rules of origin, etc.)
• Commitments expected from parties
• Mechanisms for negotiation and decision-making
• ToR is not the agreement; it is the starting blueprint for formal FTA talks.
Gulf Cooperation Council (GCC)
• Established: 1981 (Riyadh Agreement)
• Members: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, UAE
• Headquarters: Riyadh, Saudi Arabia
• Type: Political and economic union of Gulf Arab states
India–GCC relevance
• India’s largest merchandise trade bloc
• Major source of oil and gas
• Over 8 million Indian diaspora
• Large remittance inflows
• Significant potential for FTA in goods, services and investments
