Working with the Gulf

New Delhi will have to act quickly to ensure that the current crisis does not affect its relations with one of the areas of the world that is crucial to India’s security and prosperity. The six states of the Persian Gulf that are part of the Gulf Cooperation Council (GCC) — the United Arab Emirates, Saudi Arabia, Kuwait, Qatar, Bahrain, and Oman — are a major destination for Indian workers and feature the most significant concentration of the Indian diaspora. They contribute almost half of India’s annual remittances, and are thus crucial for the balance of payments and the broader economy. The GCC is also important to India in two other ways. Co-operation on security and counter-terrorism is vital, and has brought many breakthroughs for Indian national security in the past. In addition, India is a net energy importer, and the GCC countries are the major source of India’s crude oil and are important for its natural gas supplies as well. 

The GCC has been hit by two crises: Not just the spread of Covid-19 but also by the unprecedented collapse in crude oil prices. Many of the GCC states require the price of crude oil to be three or even four times the current amount in order to balance their budgets. Thus, they are facing a resource crunch. Meanwhile, the Indian diaspora there, which numbers about 8 million, is in dire straits. Many of them have been cut off from their homes because of the ban on international flight landings imposed as part of India’s battle against coronavirus. Those without documentation, in unskilled jobs, or temporarily without employment are in the worst possible situation. The GCC countries have moved to set up camps for many of them, but it is straining their relations with India. The government of the United Arab Emirates has been very clear that it would subsequently hold those countries that are not trying to take their workers home responsible. In particular, it might revisit its labour arrangements, and reduce the number of private-sector workers from those countries. This would be a disaster not just for many Indians, but also for the economy and the government.

Naturally, lifting all of these expatriates out at the same time will be difficult. But the government must show it is willing at least to evacuate those identified as being at threat from the virus. It should also consider how it can participate in the financing and management of the labour camps the GCC is setting up. If necessary, it should make budgetary provisions for some stipend to be paid to them, as well as sharing the cost of their treatment, supplies, and housing with the GCC states. This will demonstrate to those countries that India is accepting its responsibility to its citizens, and also is the right thing to do for the workers. Nothing must be allowed to impair one of India’s most important global relationships. Too much depends upon the GCC in terms of remittances, energy, and investment for ties to be sacrificed because of the exigencies of the pandemic. The government must also make contingency plans for the situation in the GCC if those countries have to tighten their belts because of continued low oil prices. 

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