Final negotiations regarding a free trade agreement between India and GCC states will begin this month to iron out remaining details of the agreement, including differential tariffs and rules of origin.
Final talks will deal with exploring opportunities in areas such as oil and gas, petrochemicals, metals and pharmaceuticals. In addition, knowledge-based products, education, health, banking, and developing India's infrastructure, including the construction of some 28 new airports in India will also be discussed.
Tourism, biotechnology and higher education are also expected to be on the agenda of future talks.
The two countries signed a framework agreement for economic cooperation in August 2004, amid moves on both their parts to expand trade ties with neighbors.
India's Prime Minister Manmohan Singh’s expressed this desire, saying “...our neighbors should have a greater stake in our economic growth and should benefit from it. The Gulf region is a part of our natural economic hinterland,” reported the The Peninsula.
Emulating trade policies of both the United States and European Union, the GCC has signed at FTA with Lebanon, while plans exist for similar FTA's with other countries, including China, Australia and the EU.
Many analysts view the move to forge ties with the East as a result of several factors, including both the surge of Asian economies and the relative ease with which Arabs can so business in the east as opposed to the west, as well as oil interests.
Thus, GCC chambers of commerce and industry have called for prioritizing economic cooperation with Asian countries.
The GCC is India’s second largest trading partner. Bilateral trade rose to nearly $20bn in 2004, with energy imports by India amounting to some $20bn in addition.