India and Qatar to Fast-Track Investment Talks for Stronger Trade Ties

Posted by author February 18, 2025 Bussiness

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In a major push to strengthen economic ties, Qatar has expressed its intent to fast-track negotiations for a new Bilateral Investment Promotion and Protection Agreement (BIPPA) with India. This move comes as part of a larger effort to deepen investment and trade relations between the two nations, with both countries looking beyond traditional energy trade to explore opportunities in new-age industries. Here, TICE brings you key details of this partnership.

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At the India-Qatar Business Forum, held under the aegis of the Confederation of Indian Industry (CII), Qatar’s Commerce and Industry Minister, Sheikh Faisal bin Thani bin Faisal Al Thani, extended a strong invitation to Indian businesses.

“We have modernized our investment ecosystem… we invite Indian investors and entrepreneurs to explore the true potential of Qatar’s economy. We are ready to take steps to fast-track negotiations for a new bilateral investment agreement,” he said, emphasizing Qatar’s commitment to fostering a dynamic and diversified trade relationship.

His remarks came as part of a high-profile visit by Amir of Qatar, Sheikh Tamim Bin Hamad Al-Thani, who landed in India with a strong business delegation for a two-day visit aimed at unlocking new avenues of economic collaboration.

India-Qatar Existing Trade and Investment Relationship

India and Qatar have long enjoyed a strong trade relationship, with Qatar serving as a key supplier of energy resources to India. However, the trade balance has recently witnessed a dip.

🔹 Foreign Direct Investment (FDI) from Qatar to India: $1.5 billion between April 2000 and September 2024
🔹 Bilateral Trade in 2023-24: $14 billion (down from $18.77 billion in 2022-23)

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Qatar exports liquefied natural gas (LNG), liquefied petroleum gas (LPG), chemicals, petrochemicals, plastics, and aluminium products to India. On the other hand, India supplies cereals, copper, iron and steel articles, processed food, textiles, machinery, chemicals, and precious stones to Qatar.

While energy trade has dominated the India-Qatar relationship, both sides are now eager to move beyond this sector, unlocking new opportunities in technology, manufacturing, and entrepreneurship.

A Shift Beyond Energy: The Road to Future Trade

India’s Commerce and Industry Minister Piyush Goyal highlighted this transition, pointing out the need to move beyond an energy-centric trade model.

“Over the years, we see a bias towards energy trade between the two countries. Now, we are looking at a new future where we transition from energy being the bulwark of our trade to new-age technologies—whether it is artificial intelligence (AI), the Internet of Things (IoT), quantum computing, or semiconductors,” he said.

India’s broader vision involves strengthening three key pillars in its trade relationship with Qatar:

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✅ Sustainability – Encouraging environmentally conscious investments
✅ Entrepreneurship – Supporting Indian startups in Qatar and vice versa
✅ Energy – Expanding cooperation beyond fossil fuels to renewables and green energy

Key Deals Signed to Strengthen Business Ties

To facilitate stronger business collaboration, two major MoUs (Memorandums of Understanding) were signed during the event:

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1️⃣ CII (Confederation of Indian Industry) and QBA (Qatari Businessmen Association) joined hands to promote investment partnerships.
2️⃣ Invest Qatar and Invest India signed an MoU to strengthen trade and investment facilitation.

Additionally, in a significant development, Qatar National Bank (QNB) announced its plans to expand its presence in India, setting up an office in GIFT City, Gujarat—India’s upcoming financial hub.

Will There Be a Trade Agreement Between India and Qatar?

One of the most crucial questions in India-Qatar trade relations is whether the two nations will move towards a comprehensive trade agreement. Responding to this, Piyush Goyal stated:

“There are always discussions of every type. We are in discussions with the Gulf Cooperation Council (GCC) for a free trade deal. Many GCC countries have also discussed bilateral agreements with India… we are open to both.”

The GCC (Gulf Cooperation Council) comprises Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE. India already has a Free Trade Agreement (FTA) with the UAE and is in advanced talks with Oman. Given this momentum, a future trade deal with Qatar seems like a strong possibility.

Qatar’s Investment Ecosystem: A Growing Opportunity for Indian Businesses

Qatar has actively modernized its investment ecosystem, making it an attractive destination for Indian businesses and entrepreneurs. With ambitious infrastructure projects, a thriving financial sector, and a push towards economic diversification under its Vision 2030, Qatar is looking beyond hydrocarbons to technology, services, and industrial manufacturing.

For Indian businesses, this means opportunities in:

🚀 Technology & AI – Setting up AI startups, fintech, and blockchain companies
🏗 Infrastructure & Real Estate – Participating in Qatar’s ambitious construction projects
🌱 Sustainability & Green Energy – Partnering on Qatar’s transition towards renewable energy
📊 Financial Services – Leveraging Qatar’s evolving banking and financial market

Indian Rupee Stability & Forex Reserves: No Cause for Concern

On the sidelines of the event, concerns were raised about the rupee’s depreciation. However, Piyush Goyal reassured the market, stating that India’s currency is performing well among emerging markets and that the country’s forex reserves are stable.

Looking Ahead: What’s Next for India-Qatar Economic Relations?

With Qatar showing a clear intent to fast-track investment agreement negotiations, the upcoming BIPPA deal and potential trade agreements could unlock new investment avenues for both nations.

For India, this means greater investment inflows, stronger trade partnerships, and new opportunities for Indian businesses in Qatar. For Qatar, it marks a shift from a largely energy-driven economic relationship with India to a more diversified partnership, spanning technology, entrepreneurship, and manufacturing.

As the two nations prepare for a new era of economic collaboration, the coming months will be crucial in shaping the future of India-Qatar trade relations—a partnership that holds immense potential for businesses, entrepreneurs, and investors on both sides.