The Free Trade Agreement (FTA) between India and the Gulf Cooperation Council (GCC) has come to a virtual standstill. Discussions between the two sides have been postponed to February, leading to a significant setback to India’s ties with the GCC. The FTA talks were earlier scheduled to take place during Commerce & Industry Minister’s visit to Oman at the end of this year or early next year for the Indo-Oman joint commission meeting. The talks have been pushed back thrice so far. Negotiations have stalled several times, and there is no convergence of views, especially in a few sectors, including polypropylene products and labour related issues. The UAE and Saudi government is not ready to include polypropylene in the negative list. GCC comprises of UAE, Saudi Arabia, Kuwait, Qatar, Oman and Bahrain.
When the FTA gets formalised between the two sides, both parties would benefit on removal of restrictive duties and tariffs will be pushed down on goods traded between the two sides. Another factor behind the delays could be that GCC, as a body, is evolving, and is coping with various issues among it’s members, including currency, taxation etc.