RIYADH: Trade and economic relations between India and Saudi Arabia have taken another step forward after the first high-level task force on investment between the two countries met earlier this week.
The body was launched in 2023 when Royal Crown Prince Mohammed bin Salman paid an official visit to the Asian country – a visit that came four years after he pledged $100 billion worth of investments in India during a trip to New Delhi.
The first meeting of the task force was held virtually on July 30 and was co-chaired by Saudi Energy Minister Prince Abdulaziz bin Salman and PK Mishra, Principal Secretary to Indian Prime Minister Narendra Modi.
During the talks, India invited Saudi Arabia's Public Investment Fund to open a branch in the Asian country as the country intends to attract funds from the Kingdom.
“Constructive discussions were held on various opportunities for bilateral investments in different public and private sector areas, including refineries and petrochemicals, new and renewable energy, power, telecommunications, innovation and others,” said a statement from the Indian Prime Minister's Office after the high-level task force meeting.
The statement added that an authorized delegation led by the country's Minister of Petroleum will visit Saudi Arabia to hold further discussions on mutually beneficial investments in the oil and gas sector.
Both countries also agreed to hold regular consultations between their technical teams to advance discussions and reach agreement on concrete investments.
India also invited the Saudi Energy Minister to visit New Delhi for the next round of high-level task force meetings.
India and Saudi Arabia: A history of long-standing relations
Although India and Saudi Arabia have enjoyed close economic and trade relations since 1947, their bilateral relations took a new turn after the signing of the Delhi Declaration in 2006.
This was followed in 2010 by the Riyadh Declaration, when then Indian Prime Minister Manmohan Singh visited Saudi Arabia and elevated bilateral relations to a strategic partnership between the two countries.
Later, Modi's visit to Saudi Arabia in 2016 reflected the spirit of increased cooperation between Riyadh and New Delhi in the political, economic, security and defence fields.
When the Crown Prince visited India in 2023 on the sidelines of the G20 Summit and to co-chair the first Leaders' Meeting of the India-Saudi Strategic Partnership Council, both countries signed eight agreements in several areas, including energy, banking and investment, as well as manufacturing, archival cooperation, anti-corruption and water desalination.
Apart from the growing economic and trade ties, India and Saudi Arabia also share a strong emotional and cultural bond. The Kingdom is the most sought-after destination for Indian talent and religious tourists.
Data from the Indian Embassy in Riyadh shows that more than 2.65 million Indians live in Saudi Arabia, acting as a “living bridge between the two countries”.
The embassy further added that in recent years, cultural cooperation between India and Saudi Arabia has also expanded into new areas of cinema and entertainment, sporting activities such as cricket and football, and tourism exchanges.
Latest trade statistics between Saudi Arabia and India
According to the Indian Consulate General in Jeddah, Saudi Arabia is the Asian country's fourth largest trading partner, while India is the kingdom's second largest trading partner.
The Indian Consulate General also recognizes that Saudi Arabia is not only a trading partner but an “important pillar of its energy security and an important economic partner for investments, joint ventures and technology transfer projects.”
Data from the General Authority for Statistics shows that Saudi Arabia's exports to India in 2023 amounted to SR113.35 billion (US$30.20 billion), while the kingdom's imports to the Asian country amounted to SR43.57 billion.
In 2023, Saudi Arabia was India's third largest crude oil exporter with 39.5 million tonnes, accounting for 16.7 percent of the country's total oil imports.
Another report published by GASTAT in July found that Saudi Arabia's shipments of goods to India in May were worth SR 8.03 billion.
In terms of non-oil exports, the Kingdom exported goods worth SR2.23 billion in May, with chemicals and related products topping the list with shipments worth SR1.27 billion.
Saudi Arabia also exported plastic and rubber products to India totaling SR448 million in the same month, while outbound shipments of base metals amounted to SR347.8 million.
On the import side, shipments from India worth SR 3.54 billion reached Saudi Arabia in May.
Mechanical equipment and electrical appliances were the most imported goods from India into the Kingdom in May, with a total value of SR 886.1 million.
In the same month, India exported chemicals and related products worth SR470.4 million, followed by plant products and base metals worth SR580.3 million and SR342.2 million respectively.
Developments in the tourism sector
Apart from trade relations, India and Saudi Arabia are also closely linked in the tourism sector.
According to the Saudi Tourism Authority, over 1.5 million Indian tourists visited the kingdom in 2023, an increase of 50 percent over the previous year.
To increase the number of Indian tourists in the Kingdom, the STA organised networking events in Mumbai, Ahmedabad, Bengaluru and Delhi in February and exchanged ideas with travel industry associations.
As part of its broader tourism strategy, the STA aims to attract 7.5 million Indian visitors over the next seven years.
Data from India's Ministry of External Affairs shows that more than 170,000 Indian pilgrims performed Hajj in 2024, a significant increase from 139,000 in 2023 and 57,000 in 2022.
Air traffic between Saudi Arabia and India has also increased by 31 percent between 2019 and 2023. Flights now connect 12 major hubs in India with Saudi cities, including Riyadh, Jeddah and Dammam.
Saudi Arabia's growth as a global tourist destination is being driven by the Kingdom's gigaprojects such as NEOM, as well as developments in the areas around Alula, Diriyah and the Red Sea.
India is also becoming a popular destination for tourists from Saudi Arabia.
A report published in July by travel app Wego found that Saudi Arabia is among the top five countries of origin for travelers from the Middle East region to India.
The analysis found that the Riyadh-New Delhi and Riyadh-Lucknow routes were the most popular among Middle Eastern travelers in the first half of this year.
“The results indicate a dynamic travel landscape where India continues to be a key destination for leisure and business travelers from around the world, driven by a variety of factors including tourism, business ventures and family ties,” said Bernard Corraya, General Manager of Wego’s India office.
