India and Qatar: Deepening Ties Through Trade, Energy, and Diplomacy

Context

India and Qatar share a long-standing and multifaceted relationship, deeply rooted in history, trade, and cultural exchanges. Qatar is a key partner for India, particularly in the areas of energy, trade, investment, and defense.

• High-level visits have played a crucial role in strengthening bilateral ties.
• The Amir of Qatar, Sheikh Tamim Bin Hamad Al-Thani, paid a State Visit to India, marking his second official visit after his March 2015 visit.
• During this visit, he held bilateral discussions with Prime Minister Narendra Modi, covering various strategic areas.

The visit resulted in elevating India-Qatar ties to a Strategic Partnership and strengthening cooperation in multiple sectors.

India-Qatar Bilateral Relationship

1. Defense Cooperation

• India and Qatar have a robust defense partnership, which includes:
  • Training programs and allocation of slots for Qatari defense personnel.
  • Naval visits and joint exercises to enhance maritime security.
  • Participation in DIMDEX (Doha International Maritime Defence Exhibition & Conference).
  • A Defense Cooperation Agreement, extended in 2018, with oversight by the Joint Defence Cooperation Committee (JDCC).

2. Trade and Investment Relations

• Bilateral trade between India and Qatar in 2022-23 stood at $18.76 billion.
  • India’s exports to Qatar: $1.96 billion
  • India’s imports from Qatar: $16.8 billion
• India is among the top three export destinations for Qatar, along with China and Japan.
• India is also one of the top three import sources for Qatar, alongside China and the US.

3. Energy Cooperation

Qatar plays a vital role in India's energy security, being:

• India’s largest supplier of Liquefied Natural Gas (LNG), providing 10.74 MMT worth $8.32 billion in FY 2022-23, which accounts for 48% of India’s global LNG imports.
• India’s largest supplier of Liquefied Petroleum Gas (LPG), supplying 5.33 MMT worth $4.04 billion in FY 2022-23, making up 29% of India's total LPG imports.

4. Cultural and Diaspora Relations

• Over 835,000 Indian nationals reside in Qatar (as of December 2023), making up 27% of Qatar’s total population.
• Qatar has undertaken major labor reforms, benefiting migrant workers, including:
  • Abolition of the Kafala system.
  • Easier job transfers.
  • Penalizing passport confiscation.
  • Introducing a minimum wage.

Key Outcomes of the Visit

1. India-Qatar Relations Elevated to a Strategic Partnership

• Both nations agreed to upgrade bilateral ties to a Strategic Partnership.
• With this, Qatar joins UAE, Saudi Arabia, Oman, and Kuwait in India’s strategic engagements within the Gulf Cooperation Council (GCC).

2. Doubling Bilateral Trade to $28 Billion

• India and Qatar set a target to double bilateral trade from $14 billion to $28 billion by 2030.
• The focus will be on:
  • Trade expansion.
  • Increased investments.
  • Strengthening energy cooperation.

3. Qatar to Invest $10 Billion in India

Qatar’s Sovereign Wealth Fund committed to investing $10 billion in India, particularly in:

• Infrastructure and ports.
• Shipbuilding and renewable energy.
• Smart cities and food parks.
• Start-ups, AI, robotics, and machine learning.

4. Exploring a Free Trade Agreement (FTA)

• Both nations discussed a potential Free Trade Agreement (FTA) to deepen economic cooperation.
• India is also negotiating an FTA with the Gulf Cooperation Council (GCC), which includes Qatar.

5. Major Trade and Investment Initiatives

• Qatar Investment Authority (QIA) to open an office in India to facilitate investment.
• Operationalization of India’s UPI at Qatar National Bank (QNB) Point of Sales, enabling seamless digital payments.
• Expansion of Qatar National Bank in India, with plans to set up an office in GIFT City.

6. Key Agreements Signed

• Two agreements and five Memorandums of Understanding (MoUs) were signed, covering:
  • Economic cooperation.
  • Youth affairs.
  • A Double Taxation Avoidance Agreement (DTAA).

7. Strengthening Energy Ties

• Qatar reaffirmed its long-term commitment to India’s energy security.
• A landmark agreement was signed between Qatar Energy and Petronet LNG Limited, securing:
  • 7.5 million metric tonnes per annum (MMTPA) of LNG supply to India for 20 years, starting from 2028.

Conclusion

Qatar remains a strategic partner for India, playing a crucial role in:

• Energy security.
• Trade and investment.
• Defense cooperation.
• Cultural and diaspora relations.

The visit marked a reset in India-Qatar relations, particularly after tensions over the incarceration of eight Indian Navy veterans in Qatar. Their sentences were commuted, and seven have returned to India, while one remains in Qatar.

The agreements and commitments made during this visit are expected to deepen economic, security, and diplomatic ties, paving the way for a new era of collaboration between India and Qatar.