THE GIST of Editorial for UPSC Exams : 02 November 2019 ( On Substance across the Arabian Sea (The Hindu))

 On Substance across the Arabian Sea (The Hindu)

Mains Paper 2: International Relations
Prelims level: India- Saudi Arabia
Mains level: Substance across the Arabian Sea

Context

•  Even by its volatile standards, our Southwest Asian sub-region has lately been unusually turbulent, as reflected in issues ranging from India-Pakistan tensions to the approaching denouements of crises in Yemen, Syria and Afghanistan.
•  The oil market, too, has been inclement. Against this disorderly context, it is no small wonder that India-Saudi Arabia relations have not only remained steady, but kept their positive trajectory.
•  Acknowledging core interests: Politically, New Delhi and Riyadh acknowledged each other’s core interests and accommodated them.
  Saudi Arabia’s position
•  Thus, Saudi Arabia showed an “understanding” of recent Indian actions in Jammu and Kashmir and India “strongly condemned” the various attacks on Saudi civilian facilities. Their bilateral defence, security and anti-terror cooperation has intensified and the first naval exercise is to be held soon.
•  The Riyadh Summit acquired added importance as it coincidentally preceded two domestic developments in India with considerable traction in the Islamic world: the conversion of Jammu and Kashmir into two Union Territories that happened on Thursday and the Supreme Court verdict on the Ayodhya dispute.
•  Despite vigorous efforts, the bilateral commercial and economic ties have still remained range-bound. Trade has drifted downwards largely due to lower crude prices.

Highlights of the bilateral trade between the countries

•  According to the latest Indian data, the bilateral trade in the first nine months of 2019 stood at $22,416 million, having fallen by 9.2% over the corresponding figure in 2018.
•  It was 5:1 in kingdom’s favour and was dominated by the traditional commodities, revealing the need for greater Indian export promotion efforts.
•  The Saudi investment in India, too, remains far below potential. The kingdom’s cumulative investments in India are only $229 million, or 0.05% of the total inbound FDI.
•  Though the kingdom’s Indian community has come down marginally to 2.6 million, they, nevertheless, are still the largest foreign community and their annual homeward remittances remain steady at $11 billion.

New bilateral council

•  Setting up of a bilateral Strategic Partnership Council (SPC) to be co-chaired by the Indian Prime Minister and the Saudi Crown Prince is a defining development.
•  Given the centralised nature of executive at both ends, it would, hopefully, expedite the decision-making process. The SPC would be a permanent bilateral platform with two verticals jointly serviced by the two Foreign and Trade & Industry Ministries.
•  Among the potential areas for next stage of bilateral cooperation could be greater bilateral synergy in Indian infrastructure, agriculture, start-ups, skilling and IT.

Way forward

•  There is growing room for optimism, however. The kingdom’s Vision 2030, a strategic document, lists eight major partner countries including India, the world’s third largest oil importer.
•  Saudi Aramco is to be one of the two strategic partners in the proposed $44 billion, 1.2 mbpd PSU refinery at Raigarh on India’s west coast. It is also to acquire a fifth of the Reliance refinery at Jamnagar and to participate in India’s Strategic Petroleum Reserves.
•  If realised, these investments could total nearly $30 billion, catapulting the kingdom to fourth position among countries investing in India.
•  Earlier, Saudi Crown Prince Mohammed bin Salman had committed to investing $100 billion in India. As the 12 bilateral documents signed in Riyadh Summit show, India and Saudi Arabia have already commenced leveraging opportunities across a vast eco-space, from energy to agriculture and from fintech to skilling.

Conclusion

•  Shifting some labour-intensive establishments from Saudi Arabia to India would serve the respective national priorities by reducing the kingdom’s expatriate population and boosting ‘Make in India’.

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Prelims Questions:

Q.1) Regional Institute of Education- NCERT will be set up in:
a. Madurai
b. Nellore
c. Kolkata
d. Chennai

Correct Answer: B
Mains Questions:
Q.1) Amid turbulence in West Asia, India-Saudi Arabia ties have not only remained steady but kept their positive trajectory. Critically analyse the statement.