India Qatar Bilateral Economic Relations

India has a long history of friendly relations with Qatar marked by commercial ties and people to people contacts. The relationship today is rich, close and multi-dimensional. The large Indian community acts as a catalyst for enhanced ties across the spectrum of bilateral relations. There is a growing synergy in the hydrocarbon and other sectors. More recently, a number of steps have been taken to further strengthen and expand bilateral relations. These include exchanges of high level visits, cooperation in multilateral institutions, political consultations etc. The Emir, HH Sheikh Hamad bin Khalifa al Thani visited India in April 1999 and in May 2005. The Prime Minister and Minister for Foreign Affairs HE Sheikh Hamad bin Jassim al Thani visited India in April 2006. Hon’ble Prime Minister visited Doha on November 9 - 10, 2008, marking the first ever visit by an Indian Prime Minister.

The Prime Minister, accompanied by a high level delegation including Minister of Petroleum and Natural Gas, Minister of Overseas Indian Affairs, Dy. Chairman Planning Commission, MOS(EA) and NSA visited Qatar on November 9 - 10.  During his visit, PM held wide-ranging discussions with the Emir.  The delegation level talks headed by the two PMs covered the entire gamut of bilateral engagement.  Both sides decided to take appropriate steps to significantly enhance the economic content of the relationship. Both sides agreed to set up a high level monitoring mechanism, which would review, on a regular basis, progress on decisions taken up during the visit.  This Committee is being co-Chaired by HE Khalid al Attiyah, Minister of State for International Cooperation and Principal Secretary to PM. The first meeting of this Committee was held in New Delhi in February 2009.  The second meeting was held in Doha on November 14, 2009 and the third meeting in Delhi on January 3 - 4, 2011.During the second meeting of HLMM, both sides concluded a MOU on facilitating Qatari investments into India. The MOU provides for the setting up of a Joint Committee to oversee its implementation. Joint Working Groups have also been set up for cooperation in the field of HRD (yet to meet) and in the field of Fertilizers and Petrochemicals (met once in February 2010). The third meeting of HLMM agreed to constitute the pending Joint Committees and to hold the meetings in a time bound manner. 

India’s bilateral trade with Qatar increased from US$ 1.2 billion in 2005 to US$ 3.7 billion in 2009. Indian exports to Qatar increased from US $ 380 million to US$ 900 million during this period.  Major items of Indian exports are machinery and equipment, transport equipment, textiles, food products, ores and minerals etc. Qatar’s exports to India amounted to US$ 2.8 billion in 2008 as compared to US$ 896 million in 2005.  India is the fourth largest export market for Qatar after Japan, South Korea and Singapore.    In terms of Qatari import, India ranks at the tenth position. As per Indian statistics, India’s exports to Qatar for 2009-10 were $537 million while our imports from Qatar for the same period amounted to $4.6 billion.

India has signed an agreement to purchase 7.5 million tonnes of LNG every year from Qatar for a period of 25 years, the first shipment took place in 2004.  The full supplies of 7.5 million ton have begun from January, 2010   In addition, 1.25 million tonnes was supplied as special cargos between July 2007 and September 2008. Negotiations have continued for about a year now for additional quantities (our demand now stands revised to 15 million tones) but pricing remains an unresolved issue. NTPC has been seeking investment from Qatar for its Kayankulam expansion project and has been talking to Qatar Petroleum International and Qatar Electricity and Water Corporation. A confidentiality agreement has been concluded following which NTPC has sent detailed data relating to the project for review by the Qatari side.We have also sought investment from Qatar in crude storage facility being developed by IOC. From our side, we have indicated interest in setting up a petrochemical and a fertilizer plant in Qatar but Qatar has indicated that these projects can only be considered after an embargo is lifted over further allocation of gas. This self-imposed embargo to preserve the North Field is likely to continue for another 2 years atleast.   A large number of Indian companies such as L&T, Dodsal, Punj Lloyd, Voltas, Simplex, Wipro, Aptech, Satyam Mahendra, NIIT etc have set up offices in Qatar and have secured major contracts/ business. The Indian community is estimated to be in the range of 500,000. Indian professionals constitute an important component. There are eight Indian schools following the CBSE syllabus. The annual remittance from Qatar is estimated to be over US$ 1 billion. Air India, Indian, Jet Airways and Qatar Airways operate direct flights between India and Qatar. Qatar Airways has been continuously increasing its services to India and has 86 weekly flights to India now.

Information Technology

Wipro has executed a project for Doha Bank for providing enterprise application integration and security consultancy services.  Wipro is presently providing IT consultancy to Qatar Petroleum in their Ras Abu Aboud Development Project.   Mahindra Consulting have successfully executed SAP implementation project with Qatar Petroleum and are now involved in the training process for the same. Mahindra Consulting has also been providing SAP technical and functional consulting services to RasGas in areas of logistics management and maintenance management.  TCS is executing projects for Qatar Petroleum  and Qatar Telecom.  Qatar is proposing to set up a smart city and is looking at Indian companies for possible collaboration.  NIIT and APTECH are successfully running their IT training institutes in Qatar.

Bilateral Trade

Following are the bilateral trade statistics between India and Qatar:

Statistics of Indo-Qatar trade as published by Qatari and Indian authorities have some variances. It is because the Qatari figures are for the calendar year and the DGCIS figures are for the fiscal year. Besides the Qatari figures do not reflect the re-exports via Dubai, which are expected to be as high as 30%. Both sets of data are reproduced below :-

Qatari Data (Calendar year):

According to the information published by the Qatar Supreme Planning Council General Secretariat, following are the figures of two way trade between Qatar and India during the period 2000 to 2006.

Qatar's Total Trade with India During the Last Three Years (all figures in mn)

Year	Imports		Exports		Total Trade
.	QR's	US $	QR's	US $	QR's	US $
2007	85,283.5	23,429.53	152,952.7	42,019.97	238,236.2	65,449.51
2008	101,556.3	27,900.08	205,997.2	56,592.64	307,553.5	84,492.72
2009	90,715.9	24,921.95	175,834.9	48,306.29	266,550.8	73,228.24
2010	84,593.0	23,239.84

Source: Qatar Statistics Authority

Indian Data ( Fiscal Year)			(US $ in Millions / Indian Rupees in Billions)
SL. No.	Year	2006-2007	2007-2008	2008-2009	2009-2010
1.	EXPORT	331.53	538.73	674.37	536.97
2.	%Growth	27.84	62.50	25.18	-20.38
3.	India's Total Export	126,414.05	163,132.18	185,295.36	178,751.43
4.	%Growth	22.62	29.05	13.59	-3.53
5.	%Share	0.26	0.33	0.36	0.30
6.	IMPORT	2,060.08	2,455.75	3,498.91	4,648.52
7.	%Growth	128.49	19.21	42.48	32.86
8.	India's Total Import	185,735.24	251,654.01	303,696.31	288,372.88
9.	%Growth	24.52	35.49	20.68	-5.05
10.	%Share	1.11	0.98	1.15	1.61
11.	TOTAL TRADE	2,391.61	2,994.49	4,173.28	5,185.49
12.	%Growth	106.00	25.21	39.37	24.25
13.	India's Total Trade	312,149.29	414,786.19	488,991.67	467,124.31
14.	%Growth	23.74	32.88	17.89	-4.47
15.	%Share	0.77	0.72	0.85	1.11
16.	TRADE BALANCE
17.	India's Trade Balance	-59,321.19	-88,521.83	-118,400.95	-109,621.45

As per Indian statistics, Indian exports to Qatar showed an increase of about 60% and our imports showed an increase of about 20% from 2006-2007.  Corresponding increases as per Qatari statistics are 38% and 60% from 2006 to 2007 (Calendar years)

Major items of Qatari exports to India include Petrochemicals, LNG, fertilizers, Sulphur and Iron Pyrites.  Major items of Indian exports include accessories, manmade yarn, fabrics, made-ups, cotton yarn, fabrics made-ups etc., transport equipment, machinery and instruments, manufacture of metals, meat and preparations etc. and other ores and minerals etc

Indian Diaspora

An important dimension of the Indo-Qatari relations is the presence of a large Indian community in Qatar. The number of Indians in Qatar now exceeds 500,000. By virtue of its professionalism, dedication and hard work, the Indian community has acquired a very good reputation in Qatar. The community constitutes a very important asset for the Government of India and, in particular, for the Indian Embassy in Qatar. By its day-to-day interaction with Qatari citizens at every level and in every walk of life, the Indian community provides strong cultural and economic links between India and Qatar and contributes in a very meaningful way to the development of friendship and understanding between the two countries.

Indian professionals and businessmen constitute a small but important component of the Indian community in Qatar. The Indian Business and Professionals Network (IBPN), the Institution of Engineers (India), Indian Medical Association and the Institute of Chartered Accountants maintain active chapters in Qatar with an expanding membership and on-going activities. In addition, there are a number of specialists working in other fields like management, education, pharmacies, software etc. As Qatar's economic development accelerates, the numbers and involvement of Indians at all levels in Qatar is expected to grow despite a reduction in visas issued for labourers etc.

Remittances

There are a number of exchange houses run by involving Indian banks, which channelise remittances to India. The three major exchange houses involving Indian banks are Eastern Exchange (Canara Bank), Trust Exchange (State Bank of India) and National Exchange (Syndicate Bank).

Growing Cooperation in the Hydrocarbons Sector

The Hydrocarbons Sector, both upstream and downstream, has been identified as a potential area for further enhancement and expansion of bilateral cooperation between India and Qatar. India is a major buyer of ethylene, propylene, ammonia, urea and polyethylene from Qatar. However, India has not been a major customer for Qatari crude oil / products.

LNG

LNG imports constitute a priority interest for India's bilateral economic relations with Qatar. Qatar has made major investments in the exploitation of its LNG reserves and is set to emerge as the world’s biggest LNG supplier by 2011. India’s geographical proximity and manifest long-term energy requirements make it a prime prospect for sale of LNG from Qatar’s point of view. In pursuance of these complementarities, the two sides had signed an MOU in January 1998 for cooperation in the gas, oil and industrial sectors. The MOU envisages a number of steps to exploit the potential in these areas, with the purchase of LNG from Qatar as its primary component. Subsequently, a final Sale and Purchase Agreement providing for supply of 7.5 million metric tons of liquefied natural gas (LNG) per year for 25 years by Qatar to India was signed in June 1999 in London. Under this agreement, 5 million tones of gas will be supplied per year from January 2004 for 25 years and another 2.5million tones from 2009 for another 25 years. In addition 1.25 million tones was supplied as special cargos between July 2007 and September 2008. During the visit of Hon’ble Prime Minister in November 2008, India sought additional supplies of LNG. Qatar currently has put an embargo on fresh commitments till it concludes its detailed assessment of LNG reserves which is expected to last at least till 2013/14. Qatar has agreed to provide some additional spot cargos. The possibility of diverting some supplies committed to other destinations is being explored.

It is evident that economic relations between India and Qatar are strong and are rapidly expanding and diversifying. There is a shared desire on both sides to further deepen these relations.

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