Qatar Issue and India

Current Issue

• Four Arab countries out of which three are also the members of Gulf Cooperation Council – Saudi Arabia, the United Arab Emirates and Bahrain along with Egypt severed diplomatic ties with Qatar as well as suspended land, sea, air travel routes to and from the country.
• The Persian Gulf and its coastal areas is the world’s largest single provider of crude oil and India might get affected by this rift that has aroused among the Arab States of the Persian Gulf.
• The growing diplomatic rift is raising concerns about the global access to Qatar’s LNG.
• Apart from that around six million Indians live and work in West Asia and in Qatar in particular, there are 6,00,000 Indian workers.
• The Saudi coalition has also decided not to allow Qatar Airways flight to their countries. This will affect Indian passengers who use Doha as the nexus to get to other destinations of the Gulf.

Reason

• A longstanding war of words had been taking place between Saudi Arabia and Qatar over the issue of Qatar and its state sponsored terrorism.
• Tensions between Qatar and its neighboring countries soared high when state-run news agency of Qatar published an article in which the Qatar’s ruling emir, Sheikh Tamin bin Hamad Al Thani was quoted praising Israel and Iran – Saudi Arab’s biggest rivals in the region.
• Qatar disowned the article and called it fake news that was manufactured by hackers, which Saudi and its allies were definitely not convinced of.
• A few days later Sheikh Tamim exaggerated the ongoing tension when he called Iranian President Hassan Rouhani to congratulate him on his re-election. This was a clear act of Qatar going against Saudi’s strong hostile stance on Iran.
• In light of this long standing feud and the recent activities on part of Qatar, Saudi Arab accused Qatar of supporting radical Islamist groups like the Muslim Brotherhood and the ISIS and hence is severing diplomatic ties with the country and also cutting links to the country by land, sea and air.
• Since then Libya, Yemen and Maldives have also joined the diplomatic boycott

Effect on India

• In the backdrop of this diplomatic crisis, with regard to India, the first point of concern is this – the country meets half of its energy import needs from the Persian Gulf and Qatar, small in size, is the world’s top seller of liquefied natural gas (LNG).
• Qatar’s dispute with Arab states has put LNG market on edge.
• The government and energy officials of India have stated that the diplomatic cut-up of Qatar by the seven West Asian countries will create “no impact” on Indian economy and political tie-ups.
• There might not be an immediate effect, but if the rift continues and intensifies and is not checked, there would be negative repercussions for India too.
• Energy imports might not get affected until Gulf countries follow through with sanctions but in case of countries like Yemen and Libya, any tensions in these regions will have a consequential impact on thousands of Indian workers.
• Qatar will be hosting 2022 FIFA World Cup and many Indian workers are working there in terms of the project related to the World Cup. Indian company L&T have won contracts to construct stadium there. Around 60000 Indians are working there.
• Qatar is India’s 19^th biggest trading partner with trade value of $9 billion. At the same it should be noted that its trade ties with the UAE and Saudi Arabia is even higher and stands at the third and fourth rank respectively and trade worth of $49 billion and $26 billion, as per 2015 Commerce Ministry figures.
• Given the risky and volatile conditions of the region, India has always tried to maintain a balanced relationship and stayed away out of “Shia-Sunni”, “Arab-Persian” or “Wahabi-Salafi” divide.
• Now Narendra Modi visted Qatar and received Emir-Al-Thani in 2016 and has also fostered deep strategic ties with the UAE and Saudi Arabia. This can be a tricky situation for the Indian government in terms of its international relationships.
• Another effect that might be seen is the rise in airfare. Flying restriction on Qatar will lead to sharp rise of airfares from Doha to India as more Indians are expected to return back home.
• Qatar Airways has suspended all its flight to the four Arab countries and currently its operations to India and elsewhere are expected to be normal. But if the situation aggravates then there would arise a threat of thousands of cabin crew and hundreds of pilots from India working in that airline getting adversely affected.