Foreign Policy Watch: India-Middle East

India-Saudi Arabia Relations


From UPSC perspective, the following things are important :

Prelims level : India-Middle East-Europe Economic Corridor

Mains level : India-Saudi Arabia partnership, India-Middle East-Europe Economic Corridor

What’s the news?

  • Crown Prince Mohammed bin Salman’s India visit showcased a significant infrastructure project linking India to Europe. It also bolstered economic, energy, and defense cooperation through crucial agreements, underscoring his influential role in shaping the India-Saudi Arabia relationship.

Central idea

  • During his New Delhi visit, Prince Mohammed’s announcement of the India-Middle East-Europe Economic Corridor, challenging China’s Belt and Road Initiative, marked a significant milestone in bilateral ties. His extended stay for a state visit and the inaugural India-Saudi Arabia Strategic Partnership Council meeting underscored the relationship’s growing significance.

Historical Foundations

  • Diplomatic relations between India and Saudi Arabia date back to 1947, reflecting centuries of socio-cultural and economic ties.
  • The watershed moment in their relationship occurred during King Abdullah’s visit to India in 200, which led to the Delhi Declaration.
  • Subsequently, the Riyadh Declaration in 2010 elevated their ties to a strategic partnership. Prime Minister Modi’s visit to Riyadh in 2016 marked enhanced cooperation in various domains, highlighted by the conferment of Saudi Arabia’s highest civilian honor upon him.

Economic Ties: Driving India-Saudi Arabia Relations

  • Bilateral Trade:
  • In the fiscal year 2022–23, India and Saudi Arabia recorded a remarkable bilateral trade value of $52.76 billion, underscoring the depth of their economic engagement.
  • This bilateral trade figure accounted for 4.53% of India’s total trade during the same period, reflecting the significance of Saudi Arabia as a trade partner.
  • Investments in Saudi Arabia:
  • As of January 2022, a total of 2,783 Indian companies had registered as joint ventures or 100% owned entities in Saudi Arabia.
  • These investments collectively amounted to approximately $2 billion, showcasing the strong presence of Indian corporate giants such as L&T, Tata, Wipro, TCS, TCIL, and Shapoorji Pallonji in the Saudi market.
  • Saudi Investments in India:
  • Saudi Arabia reciprocates India’s economic overtures with substantial investments in various sectors.
  • Notable Saudi investors in India include Aramco, SABIC, Zamil, e-holidays, and the Al Batterjee Group, with a cumulative investment reaching $3.15 billion as of March 2022.
  • Saudi Public Investment Fund (PIF):
  • The Saudi Public Investment Fund (PIF) has emerged as a pivotal player in strengthening economic ties between the two nations.
  • PIF has strategically invested in several Indian startups, including Delhivery, FirstCry, Grofers, Ola, OYO, Paytm, and PolicyBazaar, through the SoftBank Vision Fund.
  • In June 2020, PIF announced a substantial investment of $1.49 billion (equating to a 2.32% stake) in Reliance Industries’ Jio Platforms, followed by a $1.3 billion investment (2.04% stake) in Reliance Retail Ventures Ltd. in November 2020.
  • PIF’s interest in the Indian market extends to the agriculture and food sectors, with the acquisition of a 29.91% stake in Daawat Foods Ltd. in May 2020, with an investment of $17.23 million.
  • West Coast Refinery and Petrochemicals Project:
  • Among the most significant proposed investments is the $44 billion West Coast Refinery and Petrochemicals Project in Maharashtra.
  • This mega project is a collaborative effort between Saudi Aramco, Abu Dhabi National Oil Company, and an Indian consortium comprising Indian Oil Corporation, Hindustan Petroleum Corporation, and Bharat Petroleum Corporation.

Energy Cooperation: India’s Vital Link with Saudi Arabia

  • Crude Oil Supply:
  • Saudi Arabia stood as India’s third-largest source of crude oil and petroleum products in FY23.
  • India imported a substantial 39.5 million metric tonnes (MMT) of crude oil from Saudi Arabia during the fiscal year, constituting a significant 16.7% of India’s total crude oil imports.
  • LPG Imports:
  • Liquid petroleum gas (LPG) is a vital component of India’s energy mix, and Saudi Arabia contributes significantly to this sector.
  • India imported 7.85 MMT of LPG from Saudi Arabia in FY23, accounting for a noteworthy 11.2% of India’s total petroleum product imports during the same period.

Defence Partnership: Strengthening India-Saudi Arabia Security Ties

  • High-Level Visits:
  • A pivotal moment in the strengthening of defence ties was the landmark visit of General Manoj Mukund Naravane, the then Chief of the Indian Army, to Saudi Arabia in December 2020.
  • This visit underscored the commitment of both nations to enhancing their defence cooperation.
  • Naval Cooperation:
  • India and Saudi Arabia have forged extensive naval cooperation, as exemplified by the initiation of the bilateral naval exercise Al Mohed al Hindi.
  • Two editions of this exercise have already been successfully conducted, further cementing their maritime partnership.
  • Defence Industries and Capacity-Building:
  • Both countries have actively engaged in cooperation in the realm of defence industries and capacity-building.
  • This signifies their shared interest in fostering self-reliance and enhancing their defence capabilities.
  • Joint Development and Production:
  • The joint statement issued during Crown Prince Mohammed bin Salman’s visit emphasized the deepening of defence cooperation and expressed mutual interest in exploring avenues for joint development and production of defence equipment.

Indians in Saudi Arabia: A Strong and Respected Community

  • A Living Bridge: Comprising more than 2.4 million individuals, this community is not only an essential part of Saudi society but also serves as a living bridge connecting India and Saudi Arabia.
  • Contributions to Development:
  • The Indian diaspora in Saudi Arabia plays an active and constructive role in the nation’s progress and development.
  • Members of this community are engaged in various sectors, including construction, healthcare, education, and services, contributing their expertise and labor to the kingdom’s advancement.
  • Humanitarian Assistance:
  • The joint statement issued during high-level visits and diplomatic interactions highlights the strong bond between India and Saudi Arabia. It acknowledges Saudi Arabia’s commitment to taking excellent care of the Indian diaspora, as exemplified by their support during critical situations.
  • In particular, Saudi Arabia’s assistance in the evacuation of Indian nationals stranded in Sudan through Jeddah under Operation Kaveri is a testament to the collaborative spirit and humanitarian approach of both nations.
  • Facilitating Religious Pilgrimage:
  • Saudi Arabia plays a crucial role in facilitating religious pilgrimages for Indian citizens.
  • The support provided to Indian Hajj and Umrah pilgrims underscores the kingdom’s commitment to ensuring a smooth and spiritually fulfilling journey for Indian Muslims.

The Importance of Mohammed bin Salman

  • Vision 2030 and Domestic Reforms:
  • MBS has introduced Vision 2030, a transformative plan aimed at modernizing Saudi Arabia’s economy and society.
  • Notable reforms include granting women the right to drive, opening cinemas, welcoming tourists, and diversifying the economy away from oil.
  • Economic Transformation:
  • Under Vision 2030, MBS has spearheaded efforts to attract foreign investments, boost non-oil sectors, and create jobs.
  • The plan has led to substantial investments in technology, entertainment, and tourism.
  • Regional Diplomacy:
  • MBS has pursued an active foreign policy to enhance Saudi Arabia’s regional influence and stability.
  • This includes initiatives to reconcile with regional adversaries like Iran and engage with Israel.
  • Strengthened Global Ties:
  • MBS has worked to bolster Saudi Arabia’s relationships with global powers, including the United States, India, and China.
  • These partnerships encompass economic collaborations, strategic alliances, and military cooperation.
  • Controversies and Criticisms:
  • MBS has faced criticism and controversy, notably concerning human rights issues and the Jamal Khashoggi case.
  • These events have affected Saudi Arabia’s international image and diplomatic relations.


  • The India-Saudi Arabia partnership is poised for further growth, fueled by economic, energy, defence, and cultural ties. As Crown Prince Mohammed bin Salman continues to navigate the global stage, India is actively engaging with Saudi Arabia to bolster this pragmatic partnership for mutual benefit and regional stability.

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