India-West Asia Relations- Significance & Challenges-Explained Pointwise

West Asia is in the immediate neighbourhood of India & is a very critical region for the development & security of our country. However, the region has historically been a flash point because of conflict between several state & non-state actors from the region as well as involvement of superpowers in the region. The recent war between Israel & Iran and the bombing of Iran’s main nuclear sites (Fordow, Natanz & Isfahan) by the USA again put the region to the boiling point and has the potential of spilling over of the conflict to other countries in the region (Iran’s missile attack on USA’s base in Qatar).

What is the SIGNIFICANCE of West Asia for India & vice-versa?

Significance of West Asia for India:

1. Energy Security: 

• West Asia is the most crucial region for India’s energy security, supplying over 50% of its crude oil imports and a substantial portion of its natural gas (e.g., Qatar supplies over 40% of India’s natural gas).
• The secure passage through critical maritime chokepoints like the Strait of Hormuz and Bab el-Mandeb (connecting the Persian Gulf and Red Sea) is vital for India’s energy and trade flows. Any instability in these regions directly threatens India’s economic stability.

2. Economic and Trade Ties: 

• Major Trading Partner: West Asia is a vital trading partner for India, collectively accounting for a significant portion of India’s total bilateral merchandise trade (over one-sixth). The UAE is India’s third-largest trading partner globally, and Saudi Arabia is fourth.
• FTAs & Investment: The India-UAE Comprehensive Economic Partnership Agreement (CEPA) aims to significantly boost non-oil trade. India is also actively pursuing a broader Free Trade Agreement (FTA) with the Gulf Cooperation Council (GCC) as a whole.
• Market for Indian Goods & Services: The region is a key market for a wide range of Indian commodities, from agricultural products (like basmati rice, tea) to textiles, electronics, engineering goods, and services (especially IT and healthcare).

3. Large Indian Diaspora and Remittances:

• Largest Overseas Indian Community: West Asia hosts the largest concentration of the Indian diaspora, numbering over 9 million. This community plays a crucial role in the region’s economy.
• Vital Remittances: These expatriates send home billions of dollars annually (accounting for over 55% of India’s total remittance inflows), which significantly boosts India’s foreign exchange reserves and contributes to household incomes.

4. Connectivity and Geostrategic Importance: West Asia serves as a crucial land bridge for India to access Central Asia, Afghanistan, and potentially Europe.

5. Security and Counter-Terrorism Cooperation: India and many West Asian nations share concerns about radicalization, terrorism, and extremist ideologies. There’s increasing intelligence sharing and cooperation on counter-terrorism with countries like Saudi Arabia and the UAE. Joint exercises and task forces have been established to address regional security concerns.

Significance of India for West Asia:

1. Economic Diversification and Investment: Many West Asian countries (especially the GCC states) are actively pursuing economic diversification away from hydrocarbon dependence, investing heavily in non-oil sectors like technology, infrastructure, tourism, and financial services. India, with its large and growing market, skilled workforce, and tech prowess, is an attractive partner for this diversification. India’s massive infrastructure push, growing manufacturing sector, and vibrant startup ecosystem offer lucrative investment opportunities for West Asian sovereign wealth funds.

2. Food Security for West Asia: India can be a reliable source of food products for the arid West Asian nations, contributing to their food security.

3. Skilled Workforce: India provides a vast pool of skilled, semi-skilled, and unskilled labor that is crucial for the infrastructure development, service sectors, and energy industries of West Asian countries.

4. Balancing Influence: India’s growing geopolitical weight offers West Asian countries an opportunity to diversify their strategic partnerships and potentially balance the influence of other major powers (e.g., China).

5. Digital Transformation: India’s expertise in digital public infrastructure and its rapidly evolving tech ecosystem can offer solutions and partnerships for West Asian countries embarking on their own digital transformation journeys.

6. Tourism: India is a significant source of tourists for West Asian countries, contributing to their growing tourism sectors. 

What are the CHALLENGES of the region?

1. Geopolitical Conflicts and Instability:

• Israeli-Palestinian Conflict: This remains the core and most enduring source of instability, with profound political, religious, and territorial disputes. Recent escalations (like the Israel-Hamas war and Israeli-Iran direct confrontations) continue to fuel regional tensions and humanitarian crises.
• Sectarian Divides and Proxy Conflicts: The historical Sunni-Shia divide, primarily between Saudi Arabia (and its allies) and Iran (and its proxies), fuels numerous proxy wars across the region (e.g., Yemen, Syria, Iraq, Lebanon). These conflicts often involve external powers, exacerbating their intensity and prolonging instability.
• Great Power Competition: The region is a theatre for competition between global powers (US, China, Russia) vying for influence, energy resources, and strategic alliances. This often complicates regional dynamics and can prolong conflicts.
• Non-State Actors: The rise and persistence of powerful non-state armed groups (e.g., ISIS, Al-Qaeda, Hezbollah, various militias) challenge state sovereignty, contribute to violence, and foster extremism.
• Nuclear Ambitions: Concerns about Iran’s nuclear program remain a significant source of regional and international tension, raising fears of a regional arms race if other states feel compelled to develop their own nuclear capabilities.

2. External Interference and Influence (Intervention by Global Powers): The military, economic, and diplomatic involvement of major global powers (US, China, Russia, European powers) often complicates regional power dynamics and can exacerbate existing tensions.

3.  Safety and Welfare of the Indian Diaspora:

• Vulnerability to Conflict: West Asia hosts the largest concentration of the Indian diaspora, numbering over 9 million. Their safety and well-being are paramount for India. Escalating violence or political instability directly threatens the safety of these workers, potentially necessitating large-scale and complex evacuation operations (e.g., Operation Ajay during the Israel-Hamas conflict, the 1990-91 Gulf War evacuation, Operation Sindhu (2025) launched to evacuate Indians from Iran).
• Labor Exploitation & Welfare: Despite India’s efforts, migrant workers can sometimes face challenges related to labor laws, working conditions, wage disputes, or even legal issues in some West Asian countries.

4. Disruptions to Trade Routes and Supply Chains (Critical SLOCs): The Red Sea, Gulf of Aden, and Persian Gulf are vital Sea Lines of Communication (SLOCs) for India’s trade with Europe, Africa, and West Asia itself. Recent attacks on commercial shipping in the Red Sea by Houthi rebels have disrupted vital global trade routes, leading to increased freight and shipping costs, which impact global supply chains and regional economies.

5. Infrastructure Project Delays: Instability can hamper the progress of crucial connectivity projects that India is investing in, such as:

• Chabahar Port (Iran): Delays due to regional tensions and the risk of U.S. sanctions affecting partners can impede India’s access to Afghanistan and Central Asia.
• IMEC (India-Middle East-Europe Economic Corridor): The ongoing Israel-Gaza conflict has notably slowed down this ambitious project, impacting India’s plans for new trade corridors.

6. Pakistan factor: India as well as West Asian countries viewing each other through the prism of Pakistan. Pakistan claims to represent the South Asian Muslims & has blocked India’s entry into OIC and use it for propaganda purposes.

7. China factor: The growing influence of China in West Asia (e.g., China brokering the Saudi-Iran peace deal) presents a challenge to India’s strategic space and requires India to reassess its regional engagements to protect its interests.

What have been the various INITIATIVES by India for boosting ties with West Asia?

1. LOOK WEST POLICY: Adopted in 2005 with the aim to take the relationship beyond just shared past to shared challenges in the present & a shared future. It is complemented by GCC’s Look East Policy for India.

2. “De-hyphenation”: A key aspect of India’s approach towards West Asia is the policy of “de-hyphenation,” particularly concerning Israel and Palestine. India now pursues strong, independent bilateral relations with both countries based on their individual merits, without letting one relationship be held hostage by the other. This allows India to maintain its traditional support for the Palestinian cause (2-State Solution) while simultaneously deepening its strategic partnership with Israel. Simultaneously, India maintains good relations with Iran as well as Saudi Arabia & other Gulf countries – which are important poles in the region.

3. Strategic Partnership Councils/Agreements:

• UAE: The India-UAE Comprehensive Economic Partnership Agreement (CEPA) signed in 2022 is a landmark achievement, aiming to increase non-oil bilateral trade to $100 billion by 2030. This is complemented by a broader Strategic Partnership.
• Saudi Arabia: The establishment of the Strategic Partnership Council in 2019 signifies a holistic approach covering political, economic, security, and cultural cooperation.
• Iran: India has signed Tehran Declaration & New Delhi Declaration for cooperation in political, economic & connectivity projects.

4. Connectivity and Infrastructure Projects:

• International North-South Transport Corridor (INSTC): India has heavily invested in the Chabahar Port in Iran, which is a crucial gateway for the INSTC. This multimodal corridor aims to connect India to Central Asia, Afghanistan, and potentially Europe, bypassing Pakistan. India recently signed a long-term agreement (10 years) for the operation of Chabahar Port in May 2024, showing its commitment despite challenges. 
• India-Middle East-Europe Economic Corridor (IMEC): Announced at the G20 Summit in 2023, IMEC is a transformative initiative connecting India to Europe via the UAE, Saudi Arabia, Jordan, and Israel through a network of shipping lanes, railways, and road routes. It is seen as a major counter to China’s Belt and Road Initiative and a significant step towards deeper economic integration.
• Ashgabat Agreement: India joined this multimodal transport agreement in 2018, further enhancing its connectivity options with Central Asia and the Persian Gulf.

5. Defence and Security Cooperation:

• Joint Military Exercises: Regular joint exercises (e.g., naval, air force, special forces) with countries like Oman, UAE, and Saudi Arabia enhance interoperability and build trust.
• Maritime Security: India actively cooperates with West Asian navies to ensure the safety of Sea Lanes of Communication (SLOCs) in the Arabian Sea and Indian Ocean, vital for its energy and trade flows. India has secured access to strategic ports like Port of Duqm in Oman for logistical support and military use.
• Counter-Terrorism and Intelligence Sharing: Given shared concerns about radicalization and extremism, India has enhanced intelligence sharing and counter-terrorism cooperation with several West Asian states (e.g., Saudi Arabia, UAE).

6. People-to-People and Cultural Initiatives: Promoting Indian culture through Indian Cultural Centres, Yoga Day celebrations, and cultural festivals. The inauguration of the first Hindu stone temple in Abu Dhabi (BAPS Mandir) in February 2024 is a significant symbol of tolerance and cultural exchange, reflecting the UAE’s openness and India’s soft power.

7. Multilateral and New Groupings:

• I2U2 Grouping: The formation of the “I2U2” (India, Israel, UAE, USA) in 2022 is a significant strategic development, focusing on joint investments in areas like water, energy, transportation, space, health, and food security. It signifies a new geo-economic and strategic alignment.
• G20 Engagement: India’s G20 Presidency in 2023 allowed it to engage closely with West Asian members (Saudi Arabia, Turkey) and invitees (UAE) on global issues, further deepening collaboration.
• BRICS Expansion: India supported the inclusion of Saudi Arabia, UAE, and Iran into BRICS+, reflecting its interest in strengthening multilateral platforms with key West Asian partners.

What can be the WAY FORWARD?

1. Unlock Investment Potential: Proactively engage with West Asian Sovereign Wealth Funds (SWFs) and private investors, offering well-defined, de-risked investment opportunities in India’s infrastructure, logistics, digital economy, manufacturing (especially semiconductors, electronics), and startup ecosystem.

2. Enhancing Connectivity and Geostrategic Reach:

• Prioritize IMEC Implementation: While the Israel-Gaza conflict has posed challenges, India must work with partners (US, UAE, Saudi Arabia, EU) to keep the IMEC project alive. This involves active diplomatic engagement to de-escalate regional tensions and find pragmatic solutions for its multi-modal components.
• Optimize INSTC via Chabahar: Ensure the full operationalization of Chabahar Port and its integration into the INSTC network. Address remaining logistical bottlenecks and explore ways to mitigate the impact of external sanctions on the project.

3. Sustained “De-hyphenation”: Continue India’s policy of engaging deeply and independently with all key players – Saudi Arabia, Iran, UAE, Israel, Qatar, Oman, Egypt, etc. Avoid taking sides in intra-regional rivalries. Position India as a trusted dialogue partner for de-escalation and potential mediation efforts in regional conflicts, given its strong relationships across the spectrum.

4. Countering External Influence: Offer compelling alternatives and partnerships that are transparent, sustainable, and mutually beneficial to counter the growing influence of other global powers (e.g., China’s Belt and Road Initiative). Highlight India’s model of development, democracy, and technological innovation as a reliable and democratic alternative for regional partners.

5. Deepening People-to-People and Cultural Ties:

• Indian workers: Ensure prompt and effective consular support and welfare measures for the large Indian diaspora. Collaborate with West Asian countries on skill development programs tailored to their evolving labor market needs, ensuring Indian workers remain competitive. 
• Soft Power Diplomacy: Continue leveraging Bollywood, Yoga, and diverse Indian cultural forms. Promote educational and academic exchanges, student mobility, and research collaborations.

6. Strengthen Food Security Corridors: Position India as a stable and long-term supplier of food products (grains, fruits, vegetables, meat) to West Asian nations, aligning with their food security initiatives. Encourage West Asian investments in India’s agricultural and food processing sectors, creating value chains that benefit both sides.

Conclusion:
India needs to pursue a strategy of “multi-vector engagement with strategic depth” when it comes to its relationship with West Asia. This involves balancing traditional interests with new opportunities, navigating geopolitical rivalries with diplomatic agility, and leveraging India’s growing economic and technological prowess to forge partnerships that are not just transactional but truly strategic and mutually beneficial in the long term.