India-GCC commence FTA negotiations as New Delhi seeks to reduce trade deficit with the bloc

India and the Gulf Cooperation Council formally kickstarted negotiations for a freetrade agreement on Tuesday, building on the terms of reference agreed earlier this month, as per the Press Information Bureau.

Outcomes: India’s Commerce Minister Piyush Goyal and GCC Secretary General Jasem Mohamed Al Budaiwi greenlit a framework covering goods, services, customs procedures, digital trade, advanced technologies and investment flows.

Why it matters: The GCC is India’s largest trading partner bloc — with bilateral trade of USD 178.6 bn in FY 2025, growing at a 15.3% annual rate over five years — accounting for over 15% of India’s total global trade. For India, the objective is to narrow the massive USD 64.8 bn trade deficit, recorded in FY 2024-25, by pushing engineering goods, electronics, and tech services into the bloc.

Beyond trade, the talks reflect the corridor’s strategic weight. The GCC accounts for more than USD 31 bn in cumulative FDI into India and hosts nearly 10 mn Indians which reinforces economic and people-to-people ties.