Perspective: India-Qatar Partnership

• 03 Mar 2025

For Prelims: Gulf Cooperation Council (GCC), Foreign Direct Investment (FDI), Artificial Intelligence, Global South, Artificial Intelligence (AI), Unified Payments Interface (UPI), Liquefied Natural Gas (LNG), Liquefied Petroleum Gas (LPG) 

For Mains: Strategic and Economic Significance of India-Qatar Relations, Related Challenges and Way Forward 

Why in News? 

The Amir of Qatar, Sheikh Tamim bin Hamad Al Thani, paid a state visit to India from 17-18^th February 2025, to demonstrate the increasingly strong bond between the two countries. 

What are the Key Highlights of the Visit?  

• Strategic Partnership:  
  • India and Qatar have agreed to upgrade their relationship to a "strategic partnership," setting a goal to double bilateral trade to USD 28 billion within the next five years. 
  • Qatar is the 5^th Gulf Cooperation Council (GCC) country with which India has signed a strategic partnership agreement, after UAE, Saudi Arabia, Oman and Kuwait. 
• Qatar’s Investment in India: 
  • Qatar’s sovereign wealth fund has invested USD 1.5 billion in India and committed an additional USD 10 billion in sectors like infrastructure, renewable energy, and emerging technologies such as Artificial Intelligence (AI) and machine learning. 
  • Both nations signed two agreements and five MoUs, covering areas like economic cooperation, youth affairs and a double taxation avoidance agreement.      
• UPI Integration: 
  • India and Qatar welcomed the operationalization of India’s Unified Payment Interface (UPI) at Qatar National Bank (QNB) points of sale in Qatar and looked forward to implementing the nationwide rollout of UPI acceptance in the country.     
• Avoidance of Double Taxation Agreement: 
  • A revised agreement has been signed that aims to encourage investment and prevent fiscal evasion, boosting economic ties. 

What is the Strategic and Economic Significance of India-Qatar Relations? 

• Energy Cooperation: 
  • Qatar is India’s largest supplier of LNG and Liquefied Petroleum Gas (LPG), making energy a key pillar of their economic ties.  
    • In February 2024, Qatar Energy and Petronet LNG Limited signed a 20-year agreement to supply 7.5 million metric tonnes of LNG annually starting in 2028. 
• Workforce and Remittance Ties: 
  • About 25% of Qatar’s population consists of people of Indian origin, forming a vital bridge between India and Qatar. 
  • India is working to introduce UPI-based remittance solutions for Indian workers in Qatar, making financial transactions easier and cost-effective. 
  • India has agreements with Qatar to regulate labor conditions, ensuring better treatment and security for workers.        
• Food Security Cooperation: 
  • India and Qatar have been exploring food security cooperation for a long time. India supplied essential food items (vegetables, fruits, edible oil, etc.) to Qatar through Oman during the blockade by the Gulf Cooperation Council (GCC). 
    • The blockade highlighted Qatar’s need for a steady and dependable food supply, with India as a key partner. 
  • Geographic proximity, lower freight costs, and high-quality agricultural products make India an ideal food supplier. 
  • Qatar has proposed investing in Indian agricultural cooperatives to secure a stable food supply. Focus on ensuring the availability of food grains, oil, and sugar, particularly in trade bans or blockades. 
    • Qatar is expanding its hydroponic farming system and leveraging Indian expertise in this area.   

What are the Challenges in India-Qatar Bilateral Relations? 

• Energy Security Risks: 
  • Despite Qatar being India’s largest LNG supplier, global energy price fluctuations and geopolitical tensions in the Gulf could impact long-term supply stability. 
  • The need to transition towards renewable energy sources poses a challenge in balancing traditional LNG imports with clean energy investments. 
• Labor and Indian Diaspora Concerns: 
  • Ensuring the protection of Indian workers in Qatar remains a sensitive issue, with concerns about labor rights, wages, and working conditions. 
  • The effectiveness of agreements on labor regulation depends on strong willpower for implementation and monitoring. 
• Food Security Risks: 
  • Supply chain disruptions, trade restrictions, or another regional blockade like the 2017 GCC crisis could impact India’s food exports to Qatar. 

Way Forward 

• Enhancing Energy Cooperation: 
  • Expanding long-term LNG agreements while gradually increasing collaboration in renewables like hydrogen, solar, and wind energy. 
  • Encouraging Qatar’s investments in India’s clean energy projects to facilitate energy transition. 
• Ensuring Labor Welfare and Mobility: 
  • Strengthening the India-Qatar Migration and Mobility Agreement to ensure labor rights, fair wages, and social security benefits for Indian workers. 
  • Implementing UPI-based remittance solutions to improve financial access for Indian expatriates. 
• Building a Resilient Food Security Partnership: 
  • Facilitating Qatari investments in Indian agricultural cooperatives to ensure a stable food supply. 
  • Enhancing logistics and cold storage infrastructure to improve the efficiency of food exports. 

 UPSC Civil Services Examination, Previous Year Question  

Prelims 

Q. Which of the following is not a member of ‘Gulf Cooperation Council’? (2016)

(a) Iran  
(c) Oman  
(b) Saudi Arabia  
(d) Kuwait  

Ans: (a) 

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 Mains 

Q. The question of India’s Energy Security constitutes the most important part of India’s economic progress. Analyse India’s energy policy cooperation with West Asian countries. (2017)