India and the GCC sign Terms of Reference for an FTA, paving the way for deeper trade ties worth USD 178.56 billion.
India and the Gulf Cooperation Council (GCC) have taken a decisive step towards deepening their economic partnership with the signing of the Terms of Reference (ToR) for the proposed India–GCC Free Trade Agreement (FTA). The ToR was signed on February 5, 2026, at Vanijya Bhawan in New Delhi, formally setting the framework for negotiations on the long-awaited trade pact.
The agreement was signed by Shri Ajay Bhadoo, Additional Secretary and Chief Negotiator from India’s Department of Commerce, and Dr Raja Al Marzouqi, Chief Negotiator from the Secretariat General of the GCC. The signing ceremony was held in the presence of Union Minister of Commerce and Industry Shri Piyush Goyal, Minister of State for Commerce and Industry Shri Jitin Prasada, and Commerce Secretary Shri Rajesh Agrawal.
The ToR defines the scope, structure and modalities of the negotiations and marks the official launch of talks aimed at creating a comprehensive and mutually beneficial FTA between India and the six-nation GCC bloc.
Addressing the gathering, Shri Piyush Goyal described the proposed FTA as a “force multiplier for the global good.” He said the agreement would bring greater predictability and stability to economic ties, enable seamless movement of goods and services, attract investments, generate employment, and strengthen food and energy security across the region. He added that the FTA would elevate the already strong India–GCC relationship to new heights.
Dr Raja Al Marzouqi highlighted the deep-rooted historical trade links between India and the GCC, noting that the signing of the ToR signals the start of negotiations towards a forward-looking and mutually advantageous agreement, especially significant amid current global economic uncertainties. During his visit, Dr Al Marzouqi also met Commerce Secretary Shri Rajesh Agrawal to discuss ways to further strengthen the overall economic partnership and cooperation in areas of shared interest.
The India–GCC FTA carries substantial economic promise. Bilateral trade between India and the GCC stood at USD 178.56 billion in FY 2024–25, with exports of USD 56.87 billion and imports of USD 121.68 billion. This accounted for 15.42% of India’s total global trade. Over the past five years, trade with the GCC has grown steadily at an average annual rate of 15.3%.
India’s key exports to the GCC include engineering goods, rice, textiles, machinery, and gems and jewellery, while imports are dominated by crude oil, LNG, petrochemicals and precious metals such as gold. The GCC region represents a market of 61.5 million people with a combined GDP of USD 2.3 trillion at current prices, ranking ninth globally. It is also a major source of foreign direct investment for India, with cumulative inflows exceeding USD 31.14 billion as of September 2025.
Adding further strength to the partnership are nearly ten million Indians living and working across GCC countries, along with a strong presence of Indian companies in the region. Together, these economic and people-to-people ties underline the strategic importance of the India–GCC FTA as negotiations move forward.
Source: PIB
