India and the Gulf Cooperation Council (GCC) are preparing to restart formal negotiations for a Free Trade Agreement (FTA) after a long pause of nearly two decades. On February 5, 2026, India and the six-nation GCC bloc are set to sign the Terms of Reference (ToR) that will guide the full FTA talks. This step is an important diplomatic and economic milestone that could reshape trade between India and the Gulf region.
The Gulf Cooperation Council includes Saudi Arabia, the United Arab Emirates (UAE), Qatar, Kuwait, Oman, and Bahrain. These countries together form one of India’s key trading partners, especially in energy and goods. Trade between India and the GCC was around $178.7 billion in FY 2024-25, accounting for more than 15% of India’s total global trade. This shows how important the region is for Indian businesses, workers, and the economy.
The new round of talks resumes negotiations that first began in the early 2000s. India and the GCC held discussions in 2006 and 2008, but the process was stopped when the GCC chose to delay trade negotiations with external partners. After years of limited movement, both sides revived interest in deeper trade engagement. The signing of fresh Terms of Reference now makes the roadmap for detailed negotiations official.
The ToR is not the final trade agreement. Instead, it is a framework document. It outlines the scope of the FTA — what goods and services will be discussed, how tariffs might be reduced, and the procedures for negotiation. With the ToR in place, negotiators from both sides can begin long, detailed discussions on how to shape the trade pact.
India already has trade agreements with some GCC members. For example, it has a Comprehensive Economic Partnership Agreement (CEPA) with the UAE, which came into force in May 2022. India also signed a CEPA with Oman in December 2025. Additionally, separate FTA talks with Qatar are underway. However, a single, comprehensive India-GCC FTA would bring all six members together in one framework, expanding market access and reducing trade barriers in a more unified way.
A major reason why the FTA is important for India is the region’s role as a major energy supplier. India imports crude oil and natural gas from Saudi Arabia, Kuwait, Qatar, and the UAE. Reducing tariffs and smoothing trade rules could help manage energy costs better and strengthen energy security for India’s growing economy.
On the export side, India sells a mix of goods to the GCC region. These include pearls and precious stones, metals, imitation jewellery, electrical machinery, iron and steel products, and chemicals. An FTA could help lower import duties on Indian exports, making them more competitive in Gulf markets. This could boost Indian manufacturing and create jobs.
Beyond energy and goods, the GCC region is home to a large Indian diaspora. Out of an estimated 32 million Indians living overseas, a large share — possibly up to half — work in Gulf countries. Remittances from these workers support families back home and contribute significantly to India’s foreign exchange earnings. A stronger economic partnership could deepen people-to-people links and support services that connect markets, workers, and businesses.
The renewed interest in the GCC comes at a moment when India is actively pursuing other major trade partnerships, including deals with the United States and the European Union. These agreements position India as a more integrated player in global trade. An FTA with the GCC would add another dimension to India’s trade strategy, especially in West Asia and energy markets.
Although the roadmap has just been formalised with the ToR, it will take time, likely several months to years — to complete detailed negotiations. Both sides must agree on tariff reductions, rules for services, investment protections, and many other technical trade issues. But the signing itself marks a start that many businesses and policymakers have long awaited.
In summary, India–GCC FTA talks restarting is a major development for trade and diplomacy. The region’s importance in energy supply, exports, remittances, and market growth makes a potential trade pact valuable for India’s economy. As negotiations begin in earnest after the ToR signing, businesses, investors, and policymakers across both regions will be closely watching how this partnership unfolds.