Prism, November 2013

Vol. 1, No. 3, , November 2013 A CII Bi-Monthly Journal on India – Gulf & MEWANA Bilateral Ties

OMAN & QATAR:
New Partnerships,
New Opportunities

BAHRAIN-INDIA EXHIBITION & CONFERENCE

PRESIDENT’S MESSAGE

Getting
Future-Ready

A CII Bi-Monthly Journal on India – Gulf & MEWANA Bilateral Ties

I

November 2013

2

ndia’s economic and business ties
with the Gulf and MEWANA region
is a shining example of South-South
Cooperation. Down the decades,
Indian companies and professionals
have enjoyed a highly visible presence
across the region, contributing to the
physical infrastructure development,
manufacturing growth and expansion
of service industries of the Gulf and
MEWANA economies.
Since the turn of the Millennium,
businesses in the Gulf and MEWANA
countries have also enhanced their
footprint in India, especially in the
physical infrastructure sector where
India requires investments of over
$1 trillion to bridge its infrastructure
deficit. India’s bilateral trade with the
region has also increased appreciably,
with the UAE emerging as India’s top
trading partner.
While in the past the economic
ties between India and the Gulf
and
MEWANA
countries
were
transactional in nature, today
governments on both sides are taking
key steps to strengthen the bilateral
cooperation endeavours in the true
of spirit of partnership. So, while Indian
companies foray into the emerging
sectors of the Gulf and MEWANA
economies, they are also playing
a key part in the local capacity
building and skill development
initiatives. Pertinent to note that most
governments in the region have
accorded the highest priority to

local employment generation and
localisation of business.
The Gulf and MEWANA countries on
their part are also viewing India as an
attractive investment destination. Oilrich Gulf countries are now looking to
channel part of their sovereign funds to
India whose investment attractiveness
has grown against the backdrop of
economic and monetary instability in
the European economies.
In the effort to take the bilateral
cooperation with the Gulf region to a
new high, India is reaching out to the
Gulf countries to bring about an early
conclusion of talks for the proposed
free trade agreement with the Gulf
Cooperation Council (GCC), which
is indeed India’s third largest trading
partner. The council is a customs union
comprising Bahrain, Kuwait, Oman,
Qatar, Saudi Arabia and UAE.
It may be recalled that India and
the GCC had signed a framework
agreement on economic cooperation
in August 2004. India has also
signed Bilateral Investment Protection
Agreements with Oman, Qatar, Kuwait,
Yemen, Bahrain and Saudi Arabia. The
FTA will act as a major catalyst for
multi-pronged bilateral cooperation
between India and the Gulf region. In
time, India could pursue and firm up
similar arrangements with the MEWANA
economies too.
Kris Gopalakrishnan
President CII

FROM THE CHAIRMAN’S DESK

and services to Oman. It is likely to
occupy the number one slot within the
next five years.
It is not business alone that binds
India and Oman. Bilateral tourist flows
are picking up, and there are over 200
direct flights between Oman and India
every week in each direction. Peopleto-people contacts are getting
stronger, supported by the positive
and constructive role of the Indian
community in this Gulf country.
India-Oman strategic and defence
cooperation has also come a long
way. India received key support from
Omani authorities for the operational
turnaround (OTR) with regard to major
anti-piracy operations in the Omani
and Arabian seas.
Likewise, India’s economic and
business ties with Qatar have also
expanded at an appreciable pace.
Bilateral trade between India and
Qatar stood at over $16.3 billion in
2012-13, most of it by way of LNG
imports from Qatar.
Moreover, with the Iran-PakistanIndia natural gas pipeline project
running into rough weather, India has
turned to Qatar to meet its growing
natural gas requirements. Qatar holds
the world's third-largest gas reserves
after Russia and Iran.
India and Qatar are also looking
to broaden their economic ties
beyond trade in energy. Qatar is set
to emerge as a strategic investor
in India's infrastructure plans, while
India is holding steady on its security
guarantees to the Persian Gulf emirate.
This edition of PRISM also brings forth
the role of India’s heavy engineering
firms in the MEWANA region. I hope that
you will derive great value from the
articles presented in this edition.

K K M Kutty
Chairman, CII Gulf & MEWANA
Committee

3
November 2013

T

he first Bahrain-India Conference
& Exhibition held in Manama
in October this year saw the
participation of a high-level Indian
delegation which is a testament to
the deep business ties between India
and Bahrain. Over the last 5-6 years,
India’s bilateral trade with Bahrain has
increased rapidly, from $666 million
in 2006 to $1.26 billion in 2012-13.
Non-oil bilateral trade has also grown
at an equally rapid pace, illustrating
the broadening of India-Bahrain
economic engagements.
Today, Bahrain is home to
some 2,143 companies with Indian
ownership. Reports say another 19
branches of Indian companies are
operating in the fields of aviation and
management services, engineering,
banking and telecommunications.
The key elements of India-Bahrain
economic cooperation came to the
fore at the Bahrain-India Conference
& Exhibition, where Dr. Hassan Fakhro,
Industry and Commerce Minister and
Bahrain Exhibition and Convention
Authority Chairman, invited Indian
manufacturers to take advantage of
Bahrain's FTA with the US. He said in
his inaugural address that Bahrain is
an ideal location for Indian businesses
to leverage on the excellent transport
and communication links and Bahrain's
position within the GCC, to tap the
enormous regional and wider Middle
East region markets. This edition
of PRISM captures the highlights
of the event.
We have also turned the
spotlight on Oman and Qatar, two
countries with whom India’s bilateral
business engagements are growing
exponentially. Current trends suggest
that India could become the top
exporting nation to Oman in the next
five years, buoyed by the growing
trade and economic ties between
the two countries. Currently India is
the third largest exporter of products


In The Spirit of
Partnership

DIRECTOR GENERAL’S MESSAGE

New Paradigm


F

November 2013

4

or decades, Indian imports from the
Gulf and MEWANA region centred
on oil and gas supplies. But the
non-oil component of Indian imports
from the region is increasing. A recent
HSBC trade forecast indicates that
India will remain a top five trading
corridor for the UAE, Egypt and Saudi
Arabia. This might well extend to all
other Gulf and MEWANA countries too.
According to the HSBC forecast,
by 2030 India will be the UAE's top
export destination accounting for
14% of exports, and Saudi Arabia's
second largest export destination
accounting for 18.5% of exports. India
is already Egypt's number one export
destination and will maintain that
position through to 2030, accounting
for 15.4% of exports. These findings
point to the diversification and
expansion of India’s trade ties with the
Gulf and MEWANA economies.
The trade forecast also predicts
that by 2020, India will overtake the US
to import the highest share of goods
for infrastructure globally as it invests
in building its domestic networks. India
requires approximately $1 trillion worth
of infrastructure investment by 2018.
The Gulf and MEWANA countries
will also see a commensurate increase
in imports from India. For instance, as

the UAE continues to diversify away
from mineral manufactures and invests
heavily in its infrastructure, growth in
imports of goods for infrastructure and
investment equipment from India will
significantly outstrip growth in other
imports during 2013-30. At the same
time, the UAE also pledged $2 billion of
investments in Indian infrastructure.
Trade and investment ties are
not the only binding factors. India is
partnering many Gulf and MEWANA
countries in their capacity building
initiatives. As a case in point, we at
CII have put forth a proposal to
train young Omani entrepreneurs for
promoting small and medium enterprises
(SMEs). The proposal aims at training
graduates to become entrepreneurs.
A group of Omani SME promoters may
be selected to travel to India as part
of the initiative.
In keeping with India’s deeper
ties with the GCC countries, Bahrain
will be the Partner County at the CII
Partnership Summit which will be held
in Bengaluru in January 2014. We
look forward to accelerated business
engagements between India and the
Gulf and MEWANA economies.
Chandrajit Banerjee
Director-General CII

NEWS IN BRIEF

the hospitality, retail and aviation
sectors will experience a significant
positive impact, further strengthening
their
already
robust
positions.”
UAE's AFZA seeks investments
from India
Aiming to attract Indian businesses,
a delegation from the Ajman Free
Zone Authority (AFZA) visited India
recently to promote the benefits of
investing in Ajman, UAE. AFZA offers
100% foreign ownership, repatriation
of capital and profits, no corporate
tax, no personal income tax and no
import and export duties. Besides, the
authority offers benefits like lowest
lease prices and tariff, extremely low
handling charges, easy access to
workforce, single window clearances
and cheap energy to businesses
interested in setting up an offshore
company. India is the largest trading
partner of the UAE. At present, over
8,000 companies are registered and

operating in the Ajman Free Zone out
of which 38% are of Indian ownership.
Seetharam new Indian ambassador
to UAE
The Government of India has
appointed Mr T P Seetharam, the
Indian High Commissioner to Mauritius,
as the Indian Ambassador to the UAE.
Mr Seetharam has handled India’s
bilateral relations with countries in
Europe as Additional Secretary, West
Europe and as Joint Secretary Central,
Europe in New Delhi. He was the
Director General of the India-Taipei
Association and has also worked in
the Indian Embassy in Beijing and
the Indian Commission in Hong Kong.
Saudi's SABIC opens $100m tech
centre in India
Petrochemicals
giant
Saudi
Arabian Basic Industries Corporation
(SABIC) has set up a $100m
technology centre in India. Prince

5
November 2013

D

ubai has won the bid to
host Expo 2020, beating
three other final contenders:
Russia, Brazil and Turkey. This
bid took place at the 154th
Bureau International des Exhibitions
(BIE) General Assembly held in Paris
recently. Representatives of the 168
BIE member nations voted on the bids
to host the 2020 edition of one of
the world’s oldest, largest and most
significant international mega-events.
Dubai’s bid was themed ‘Connecting
Minds, Creating the Future’.
Between October 2020 and April
2021, more than 25 million visitors are
expected to attend Expo 2020, 70%
of which will be from outside the UAE.
His Excellency Helal Saeed Almarri was
quoted by a media publication as
saying: “The legacy of holding such an
event in Dubai is where the real value
lies. A wide range of sectors will benefit,
including construction, engineering
and transportation, and of course


Dubai to host Expo 2020


NEWS IN BRIEF

November 2013

6

Saud bin Abdullah bin Thenayan AlSaud, chairman of SABIC, officially
opened the company's state-of-theart facility in Bengaluru. The centre is
one of 17 SABIC global R&D hubs of
excellence and is home to more than
300 scientists from India, described
by SABIC as "a critical mass of some
of the best and brightest talent from
this vibrant country". Mohamed AlMady, SABIC's vice chairman and
CEO, told the media: "This major
centre in Bengaluru is an integral
part of our global R&D strategy.
In this centre the scientists here are
carrying out cutting-edge research

‘Nitaqat no big impact on India’
Government
of
India
has
maintained
that
the
"nitaqat"
implemented by Saudi Arabia to
streamline their labour market and
identify illegal workers has not had
any major adverse impact on Indian
workers owing to the extension of
grace period twice. Indian Overseas
Indian Affairs Minister, Mr Vayalar
Ravi, told Lok Sabha: “The grace
period has been extended twice —
first up to July 3, 2013 and second
up to November 3 this year. The
policy has not had any significant
adverse impact on Indian workers in

Reserve Bank of India license to
start operations in India. The Bank
will open a branch in Mumbai
in 2014-15 to offer diversified
banking services, particularly in
the wholesale space. The bank
would leverage funds in the Gulf to
offer them to Indian corporates,
particularly small and medium
enterprises. There is a large
diaspora of Indian population
in Qatar and besides various
Indian companies are active in
infrastructure projects in Qatar. The
license will pave the way for the
bank to support all expatriates with

into new platforms for next-generation
materials across industry sectors.”

Saudi Arabia except on those who
were working there without proper
valid documents.”

the best in class solutions especially
remittance solutions. According to
a news report, Indian diaspora is
likely to remit around $10 million
in 2013 using Doha Bank facilities.

India lifts anti-dumping duty on
Oman’s polypropylene export
India has lifted an antidumping
duty
imposed
on
polypropylene
imported
from
Omani suppliers, especially the
Oman Polypropylene. India had
clamped an anti-dumping duty of
6.5% on polypropylene originating
from Oman or exported from the
Sultanate (and from Saudi Arabia
and Singapore) on November
19, 2010 to protect domestic
manufacturers. The latest decision
will make Omani polypropylene
cheap in India, giving the much
needed relief to the state-run Oman
Polypropylene Company as South
East Asian countries, including India,
are major markets for the Sultanate's
polypropylene
producers.

Oman-India SPV to complete
deployment soon
Oman-India Joint Investment Fund,
a special purpose vehicle ( SPV) for
promoting joint investment in projects
in India, will complete deploying
its first tranche of $100 million in
the coming months, said Indian
Ambassador to Oman, Mr J S Mukul.
According to a news report, Mr Mukul
said that the investment partnership
between India and Oman is reflected
through operation of hundreds of
joint ventures and are valued at
$7.5 billion. Out of this, the Indian
contribution was $4.5 billion.
Doha Bank to start ops in India
Qatar-based
Doha
Bank
has announced that it got the

Egypt invites Indian pharma firms
Egypt has invited Indian pharma
companies to invest and manufacture
final products in the country. The focal
point would be to engage Indian firms
to manufacture pharma final products
and export to the whole Mena
region. Further, to tap the growing
MENA
markets,
Pharmaceuticals
Export Promotion Council of India
(Pharmexcil) will set up Indian Pavilion
at Arab Health, a major international
exhibition to be held in Dubai in
January 2014. Reports say the world
is increasingly looking at India for
front-end manufacturing solutions,
contract research and machinery,
and technologies.

PARTNERSHIP

Strengthening India-Oman
Business Ties
CII trade mission to Oman cements partnerships with Oman Chamber of
Commerce and Industries, Salalah Free Zone and other business entities

A

CII trade mission visited
Salalah Free Zone in
Oman in September this
year to explore investment
opportunities in one is
being seen as one of the most
favoured investment destinations in
the Gulf region. The mission expressed
interest in leveraging the investment
opportunities extant in the zone’s
infrastructure development, including
airport and port facilities.
Mr K K M Kutty, Chairman, CII Gulf
& MEWANA Committee, and leader of
the trade mission, was quoted by the
Oman Observer as saying: “Salalah
is emerging as a major investment
hub. We are exploring investment
opportunities in sectors like health,
information technology, industrial
training, cable making, centrifugal
pump manufacturing, gaskets for
automobile manufacturing, industrial,
marine and oil field applications,
manufacture of rubber moulding and
products of natural rubber, nitrile,

neoprene, silicon, EPDM, viton, etc,”
The mission also held meetings
with prospective trade partners and
officials of the Oman Chamber of
Commerce and Industries (OCCI) in
Muscat. The mission also explored
investment opportunities in Oman in
areas like manufacturing of rubber
sheets, suction and delivery hoses
for water and oil, water pumps,
camlock fittings, safety products,
various products for shipping industry,
graphite sheets and components,
hydraulic seals, PTFE products, gland
packings, copper, aluminium and fibre
washer, non-asbestos and asbestos
jointing, etc.
Mr Santosh Kumar Mishra, a
healthcare consultant who was a
member of the mission, was quoted by
a daily as saying: “Oman stores great
investment opportunity in health sector.
I came to know about a medical city
being developed in Salalah. As an
expert in Hospital Information System
I would love to explore investment

opportunity in that area.”
The mission also offered to extend
cooperation to the zone in setting up
training centres for Small and Medium
Enterprises (SMEs). Discussions are now
underway to hold training workshops
under OCCI with the assistance of
CII. A group of Omani SME promoters
may be selected to travel to India as
part of the scheme.
Mr Khalil Abdullah Al Khonji,
chairman of the Oman Chamber of
Commerce and Industry (OCCI) told
the media that Indian goods would
reach the Arab countries faster and
more easily once Salalah and Duqm
are linked by a railway line. Indian
exporters could transport their goods
to these ports and later transport the
same through the railway line, which
will connect other GCC states.
Mr J S Mukul, Indian Ambassador
to Oman, was quoted saying the
multi-sectoral CII delegation had
paid due attention to various
business sectors. The 14-member

7
November 2013

(L-R) Mr Faris Nasser Al Farsy, Director General, Public Authority for Investment Promotion and Export
Development (PAIPED), H.E. Amb. Mohammed Awadh al Hassan, Ministry of Foreign Affairs, Sultanate of Oman,
Mr Gurpal Singh, Principal Advisor, Gulf & Middle East, CII and Mr Anjan Das, Executive Director, CII.


Meeting with high level Science and Technology delegation
from Sultanate of Oman, 21 October 2013, New Delhi

November 2013

8

CII delegation, representing a wide
spectrum of industries, aims to build on
the past successes because "we still
believe that despite these successes,
we have only realised the tip of the
iceberg and there is tremendous
potential" to expand cooperation,”
Mr Mukul said.
On
economic
cooperation
between India and Oman, Mr Mukul
stated, "Last year, the trade and
investment between the two countries
were very robust. For example, India
for the first time in 2012 emerged as
the top destination for Omani nonoil exports. Non-oil Omani exports
to India grew by 46% during 2012.
On the other side, the Indian exports
to Oman almost doubled during the
financial year 2012-2013."
India-Oman business ties have
expanded considerably in recent
years. Several Indian companies have
been present in Oman for many years.
They are engaged in infrastructure
development, oil & gas related
engineering works, IT and a number
of other fields including education.
Omani companies also have joint
ventures in India.
Moreover, the Oman-India Joint
Investment
Fund,
a
special
purpose vehicle ( SPV) which has
been set up for promoting joint
investment in projects in India, will
complete deploying its first tranche

of $100 million soon.
A leading daily quoted Mr
Mukul saying at the India Business
Seminar
that
the
investment
partnership between India and
Oman is reflected through operation
of hundreds of joint ventures and are
valued at $7.5 billion. Out of this, the
Indian contribution was $4.5 billion.
The investment fund was formed in
2011 by the State Bank of India (SBI)
and the State General Reserve Fund
of Oman (SGRF).
Among these joint ventures, the $1
billion Oman-India Fertiliser Company
in Sur is the flag-bearer of India's
investments abroad. Similarly, Oman
has made significant investments in
the $2.4 billion Bharat-Oman Refinery
at Bina, Madhya Pradesh.
Energy trade is a key constituent
of India’s trade ties with Oman.
Recent reports indicate that Iran
has agreed to deliver natural gas
to India through a deepwater
pipeline crossing the Sea of Oman.
A top official of National Iranian
Gas Exports Company (NIGEC)
was quoted in a leading Gulf daily
as saying: "Negotiations were held
with three Indian companies for
their purchase of gas from Iran, and
general agreements have been
reached.”
India-based South Asia Gas
Enterprise (SAGE) has conducted

feasibility studies for the planned
1,400km pipeline, which is estimated
to cost $4-5 billion. The pipeline is
expected to transit 31 million cubic
metres per day of gas to India when
it comes on-stream. The envisaged
pipeline will pump gas from Iran's
gigantic South Pars gas field.
The Omani business interest in
India is also reflected in a 15-16%
compounded growth rate in the
number of Indian visas issued by
the Embassy in Muscat in recent
years. In a bid to promote Oman's
maritime heritage, Oman Tourism has
conducted a sailing event in Mumbai
where 40 travel trade partners not
only got an opportunity to sail, but
also got a better understanding of
the destination.
Oman is also planning to promote
itself as a niche wedding destination
for Indians.”The Indian wedding
industry is now worth more than $25
billion a year and it is growing at an
estimated 20% year over year," an
Indian representative of the Ministry
of Tourism, Oman, told a daily.
A high level Science and
Technology delegation from Oman
visited India in October this year to
establish new partnerships with Indian
science and technology institutions.
The stage is set for deeper
India-Oman business engagements
and partnerships.

INTERVIEW

‘India-Oman Bilateral Partnership
Has Turned A New Leaf’

chemicals & fertilizers, education, oil &
gas, power and mining.
The annual Indo-Oman Strategic
Consultative Group (IOSCG) meeting
and institutional mechanisms like the
Joint Commission Meeting (JCM) and
Joint Business Council (JBC) – which
was set up to oversee economic
cooperation between India and
Oman -- have all contributed to the
strengthening of India-Oman economic
relations and business partnerships.

Mr J S Mukul,
Indian Ambassador
to Oman
to transform the bilateral ties into a
strategic partnership. In December
2010, a Higher Committee on
Economic Cooperation was formed,
which later identified nine areas of
bilateral cooperation: agriculture,
healthcare, infrastructure, tourism,

India is Oman's largest destination
for its non-oil exports and the fourth
largest source of imports. What steps
are being taken to accelerate the
bilateral trade flows?
India-Oman bilateral trade which
is around US$ 5 billion per annum
has increased by as much as 129%
in the five-year period between
2008-09 and 2012-13.
During
2012, India emerged as the largest
destination for Omani non-oil exports.

9
November 2013

I

ndia-Oman ties date back
to the Roman and pre-Islamic
times. Down the decades, more
than 7 lakh Indians have taken
up employment and business
activities in Oman, making them
the largest expatriate community in
the country. Against this backdrop,
how would you assess the growth of
India-Oman bilateral economic ties?
India and Oman enjoy strong
bilateral political, diplomatic and
economic relations cemented by
shared history, centuries-old trade
linkages, diverse business partnerships,
cultural contiguity, and a common
understanding on key international
issues. Oman is a strategic partner
to India in the Gulf region and plays
a key role in deepening India-GCC
bilateral ties.
India-Oman bilateral partnership
turned a new leaf in November 2008
when following our Prime Minister’s visit
to Muscat, both countries agreed


Indian Ambassador to Oman, Mr J S Mukul, shares his thoughts on IndiaOman bilateral ties and business engagements

INTERVIEW


Indian exports to Oman doubled
during 2012-13 as compared to
the previous year 2011-12. India
ranked as the fourth largest source
of imports into Oman during 2012.
Major items of Indian exports are
textiles and garments, machinery and
equipment, electrical and electronic
items, chemicals, iron and steel
products in addition to traditional
items like tea, coffee, spices, rice and
meat products and seafood. India
is also one of the major destinations
for non-oil exports from Oman, and

November 2013

10

between India and Oman, of which
the US$969 million Oman-India
Fertilizer Company (OMIFCO) in Sur,
Oman and the US$2.4 billion BharatOman Refineries Limited (BORL) in Bina,
Madhya Pradesh are the flag-bearers.
Indian companies are active in
various sectors in Oman like oil & gas,
mining, manufacturing, IT & telecom,
power & water, construction, real estate
& consultancy, healthcare, warehousing
& logistics, railway sector and steel
etc. Indian companies in construction
sector of Oman have faired very well

investment opportunities in India, in
areas like physical infrastructure.

major Omani export commodities are
urea, LNG (through spot purchase),
polypropylene, lubricating oil, dates
and chromite ore.
Though generally, the balance
of trade has been in Oman’s favour
due to export of fertilizers and spot
purchase of oil & gas by India, but
during 2012-13 it was in India’s favour.
With better maritime connectivity
we can expect the bilateral trade
flows to increase at a rapid pace.
The direct cargo shipping service
between Nhava Sheva port in India
and Salalah port in Oman, illustrates
the improved transport connectivity
between the two countries.
The
India-GCC
framework
agreement on trade will also help
accelerate India-Oman bilateral
commercial exchanges, besides the
proposed India-GCC FTA.

during 2013 winning mega contracts
totaling to over US$1 billion. Omani
companies are also present in
diverse areas in India like oil & gas,
manufacturing, IT & telecom, hospitality,
healthcare and financial services etc.
As per the June 2013 report of
the National Centre for Statistics
and Information of Oman, the
Sultanate’s
overseas
investments
rose by 36.5% to OR 5.48 billion by
the end of 2011 over the figures of
2010. During the year 2011, India
with share of 7.2%, was the second
most important destination for Omani
direct investments abroad.
According to a report, Oman was
the second biggest GCC investor in
India and Oman’s cumulative FDI in
India had grown from US$24 million in
2005 to US$340 million as of January,
2012. FDI into Oman during 2012 was
at OR 6.48 billion compared to OR 5.9
billion in 2011, or an increase of 9.6%.
As the Omani economy diversifies,
we can expect a greater number of
Indian companies to establish their
footprint in the Omani business arena
through joint ventures. Likewise, many
Omani firms are likely to leverage the

time.
Called the South Asia Gas
Enterprise (SAGE), the proposed subsea pipeline will meet the additional
gas requirement of India, besides
easing gas transportation issues of
producing countries. More recently,
IOC had signed a `principles of
co-operation (POC)’ with South
Asia Gas Enterprise (SAGE) which
has also undertaken a fresh survey
for the sub-sea pipeline route.

Indian and Omani firms have entered
into joint ventures in sectors like
fertilisers, pharmaceuticals, energy
and engineering. Are there any other
areas where bilateral investment
flows are likely to increase?
There are over 1,527 joint ventures

India has evinced keen interest in
importing natural gas from Oman. A
1,100 foot undersea gas pipeline
connecting Oman and India is
being planned. What are the
challenges and opportunities in
implementing this project?
The construction of a 1,100-kmlong underwater gas pipeline from
Oman for transporting natural gas
has been on the table for quite some

For many people in the Gulf
countries, India is increasingly the
preferred destination for medical
treatment. Are people of Oman
considering India as a reliable
and affordable place to receive
medical treatment?
For Omanis seeking treatment
abroad, India has emerged as the
top medical tourism destination.
Most of the patients visit India for
rehabilitation and physiotherapy,
and to be treated for cancer,
cardiac
disease,
orthopaedic
problems, etc. India is indeed
a major destination for reliable
and affordable value-for-money
medical treatment.

PARTNERSHIP

India-Qatar Business Ties: Gaining
Momentum

opportunities and form joint ventures
with Qatari companies,” he said.
Mr Kutty observed that small and
medium business is one area where
Qatar can learn a lot from India. “We
are ready to help Qatar to set up
SMEs by providing them with essential
technologies and training,” he said.
Qatar Chamber of Commerce
Board Member, Mr Mohamed Ahmed
al Obaidy, has said that India is
considered as one of the biggest
economic partners with Qatar, whether
on the level of trade volume or on the
labour force working in Qatar. “Thus,
we are always looking forward to
enhance partnership between us to
reach as higher rates of cooperation
as possible,” he told a daily.
“CII works closely with Indian
government
on
policy
issues,
interfacing with thought leaders, and
enhancing efficiency, competitiveness
and business opportunities for
industry through a range of
specialised services and strategic
global linkages,” said Mr Gurpal Singh,
Principal Advisor - Gulf, Middle East &
North Africa, CII, while commenting on
the delegation visit.
CII and QCCI signed an MoU
to strengthen business cooperation
between the two countries. The MoU

affirmed the joint endeavour of the two
chambers to accelerate knowledge
sharing as well hold regular seminars
and conferences to bring businesses
on both sides on a common platform.

11
(L-R) Mr P S Sasi Kumar, Deputy Chief of
Mission at the Indian Embassy in Doha,
Mr Mohd. Ahmed al Obaidy, QCCI Board
Member, and Mr K K M Kutty, Chairman,
CII Gulf & MEWANA Committee

Mr Gurpal Singh, Principal AdvisorGulf, Middle East and North Africa of
Confederation of Indian Industry (CII)
with Mr Mohammed Bin Ahmed Al Obaidli,
Member of the Board of Directors, Qatar
Chamber of Commerce & Industry (QCCI).

November 2013

E

ven
as
bilateral
trade
between Qatar and India
increased from $1.2 billion in
2005 to $16 billion in 2013,
Indian exports to Qatar
have fallen several notches below
Qatari exports to India. A high-level
14-member CII business delegation
comprising CEOs and other senior
representatives of various companies
visited Qatar in September to explore
the Qatari market for stepping up
Indian exports to the Sultanate.
The
delegation
included
representatives of sectors such
as infrastructure, energy, heavy
engineering,
manufacturing,
engineering, communications and
information
technology,
financial
services,
international
trading,
pharmaceutical and healthcare.
Speaking on the issue to Qatar
Tribune, Mr K K M Kutty, Chairman,
CII Gulf & MEWANA Committee, said
that while Indian exports to Qatar
posted only marginal increase during
2005-13, there was a massive jump
in exports from Qatar to India. “The
trade gap is a matter of concern for
us. We are here to bridge this gap.
There are so many things that can
be exported to Qatar from India.
The CII team is here to explore those


CII trade mission to Qatar signals a new phase of India-Qatar
business partnerships

VIEWPOINT

Growing Times


Relations between Qatar and India are set for a big leap, says Mr Sanjiv
Arora, Indian Ambassador to Qatar
By Ramesh Mathew

November 2013

12

R

elations between Qatar and
India are set for “a big leap”,
Indian ambassador to Qatar,
Mr Sanjiv Arora has said. “I am
extremely happy at the way
things are progressing as both the
countries stand to gain substantially
from the enhanced levels of bilateral
co-operation,” he explained.
Business forums from India and
business houses from Qatar have
exchanged numerous visits in the 13
months since September 2012. “While
business delegations spearheaded by
Confederation of Indian Industry (CII),
Association of Chambers of Business
and Industry (ASSOCHAM), Federation
of Indian Chamber of Commerce

and Industry (FICCI) and CAPAXIL
(a forum of chemical manufacturers)
have undertaken visits to Qatar,

Mr Sanjiv Arora, Indian
Ambassador to Qatar

entrepreneurs from Qatar have made
similar visits to India during the period,”
said Mr Arora.
The visits have not only contributed
to stronger commercial links between
the two countries but have also
helped in spreading better awareness
about the business environs in India
among Qatari entrepreneurs. The
ambassador said India expected
good participation of Qatari officials
in the Annual Partnership Summit to be
held in January 2014.
The envoy said he was happy
that Qatar National Bank (QNB) had
already begun operations in India’s
commercial capital Mumbai where
Qatar Investment Authority

(QIA) had also set up an office
to explore investment opportunities. “A
number of Qatari entrepreneurs have
evinced interest in recent months to
invest in real estate, hospitality, leisure
and similar ventures in India,” he said,
adding that Indian banks and other
financial institutions were keen to do
business with Qatar.
At least four Indian banks
are
already
managing
money
exchanges in Qatar. Another good
development, said the ambassador,
was the participation of a number
of representatives of Qatari business
houses at the Overseas Employers
Meeting organized by the Ministry of
Overseas Indian Affairs in Dubai.
Arora recalled that in less than a
month after India’s Finance Minister, Mr
P Chidambaram visited Qatar and met

is understood that the Qatari officials
are interested in using the expertise
of Indian officials and institutions for
the successful conduct of the 2022
World Cup.
The meeting in New Delhi
was held under the aegis of the
Ministry of Overseas Indian Affairs,
Government of India. He noted the
Qatar Foundation acquiring 5%
stake in India’s Bharti telecom and
Hassad Foods taking 51% share in a
prominent foodstuff company in India.
The Bharti deal was worth $1.29bn,
pointed out Arora.
The ambassador mentioned the
meetings that he had with almost all
ministers of the new Qatari cabinet
since the new leadership assumed
the office on June 25 and also the
meeting that he had with the Chairman

co-operation in the areas of defence
with Qatar in the coming years, said
Mr Arora. The envoy said three
Indian naval ships were on friendship
visit to Qatar this year and India
is happy at the outcome of the
third meeting of the joint committee
on defence co-operation held in
Doha in September.
He said apart from an anti-marine
pollution carrier Samudra Prahari
which visited Doha in February, two
other ships of the Western Fleet of
the Indian Navy - INS Tabar and
INS Aditya - were also on visit of
Qatar in September.
The envoy said a number of officers
from different countries’ armed forces,
including those from the GCC states,
participate in the training programmes
at the India’s defence institutes. Arora


VIEWPOINT

senior officials in different departments
there had been “significant changes” in
links in banking, finance, business and
investments. “There has been a higher
level of flows of Qatar investments to
the Indian market and it is very much
evident in the recent decisions on
Qatar investments in India’s sovereign
and pension funds.”
The
ambassador
expressed
happiness at the two-day meeting of
the Indo-Qatar Joint Commission on
Human Resources, which concluded
in New Delhi. “It was attended by
many senior officials of the Ministry
of Labour and Social Welfare. It also
had the participation of members
of the Supreme Committee for
Organizing FIFA World Cup 2022.” It

of the Ooredoo, representatives
of the Qatar Chamber and Qatar
Business Women Association. “The talk
that I gave on QF Radio, highlighting
the opportunities in India’s tourism
sector seems to have been well
received by the country’s residents
and I also had an opportunity to
interact with a number of local
youngsters,” said the ambassador,
while thanking the Arab media for
the coverage given to the radio
talk. “There has been a remarkable
increase in the number of business
and tourist visas issued to Qatari
nationals in recent months,” he said.
Defence ties with Qatar
India is looking forward to enhancing

said the Indian Navy and the Emiri Navy
have evinced interest in enhancing
mutual co-operation and India has
extended an invitation to the Emiri Navy
to participate in the fourth Admiral’s Cup
Sailing Regatta to be held in Alappuzha
in Kerala this year. “The regatta event is
well known among the navies all over
world and there has been remarkably
good levels of participation every year,”
said the ambassador.
Arora said the India is also
exploring the possibility of more
co-operation in training between
the members of the Diplomatic
Institute of Qatar and Foreign
Service Institute of India’s Ministry of
Foreign Affairs.
(Courtesy: Gulf Times, Doha)

November 2013

13

IMPACT

Showcasing India


The first Bahrain-India Conference and Exhibition held in Manama drew
high-level participation from Indian companies

VISIT OF A BUSINESSWOMEN’S
DELEGATION FROM ABU DHABI

VISIT OF PRIME MINISTER OF KUWAIT

14
November 2013

Members of Abu Dhabi Businesswomen
Delegation with Smt. Sheila Dixit, Hon’ble
Chief Minister of Delhi.

Mr T N R Rao, Senior Member, CII Gulf Council; Mr Anand Sharma, Minister
of Commerce & Industry, Government of India and His Highness the Prime
Minister of The State of Kuwait Sheikh Jaber Mubarak Al-Hamad Al-Sabah
at the Industry Meeting held at New Delhi on 8 November 2013.

T

he
first
Bahrain-India
Conference and Exhibition
was
inaugurated
by
Industr y and Commerce
Minister
and
Bahrain

H.E. Eng. Fatima Obaid Al Jaber,
Chairperson of the Abu Dhabi
Businesswomen
Council
at
CII
Interactive Session.

Exhibition
and
Convention
Authority Chairman, Dr Hassan
Fakhro at the Bahrain International
Exhibition and Convention Centre,
on October 23, 2013.

Dr Fakhro in his inaugural
address praised the high level
participation
of
the
Indian
delegation in the event. He said
Bahrain's non-oil trade with India

IMPACT
services, engineering, banking
and telecommunications besides
the 116 commercial agencies.
“The government is doing
ever ything possible to improve
the economic environment in
Bahrain and in particular to
remove any unnecessar y delays
in the administrative systems.
We are proud of what we have
achieved thus far; but the future
is still to be written, and our
economic and labour reforms,

Highlights of the Conference & Exhibition

Extensive Media Coverage

underpinned
by
democratic
processes,
strengthened
by
international
and
regional
agreements and associations, will
ensure that this will be a bright
and prosperous future. India is an
indelible part of our past, and
will continue to play a role in our
future,“ Dr Fakhro said.
Dr
Fakhro
invited
Indian
manufacturers to take advantage
of Bahrain's Free Trade Agreement
(FTA) with the US.


grew by more than 135%
between
2006
and
2011,
reaching $882 million in 2011. The
overall trade volume that includes
both oil and non-oil trade in 2011
amounted to $2.5 billion, up over
280% against the $666m in 2006.
Bahrain
is
also
home
to
2,143
companies
with
Indian ownership. Another 19
branches of Indian companies
are operating in the fields of
aviation
and
management

The event received extensive media coverage, as illustrated below:

November 2013

15

INFRASTRUCTURE

Building Blocks


Indian heavy engineering firms deepening footprints in MEWANA region

November 2013

16

T

he heavy engineering sector
can be classified into two
broad segments – capital
goods (which is further
classified
as
electrical
machinery
and
non-electrical
machinery), and equipment segments.
Electrical
machinery
includes
the following: power generation,
transmission
and
distribution
equipments such as generators and
motors, transformers and switchgears.
Non-electrical machinery includes
machines used in various other sectors
such as textile machinery, cement
machinery, sugar machinery, rubber
machinery etc. Equipment segment is
comprised of equipment such as material
handling equipment (earth moving
machinery, excavators, cranes, etc), oil
field equipment like onshore and offshore
drilling equipment, etc. The major enduser industries for heavy engineering
goods are power, infrastructure, steel,
cement, petrochemicals, oil & gas,
refineries, fertilisers, mining, railways,
automobiles, textiles, etc.
A segment wise review
is presented as follows:
Capital Goods: The capital goods
sector, which is the barometer in
investment in the economy, contributes
12% to the manufacturing activity,
representing a multi-disciplinary field

with numerous end-use application
areas. It has a strong production base
capable of manufacturing a diverse
range of machinery and equipment to
serve a cross-section of user industry
segments ranging from defence, oil
and gas refinery, nuclear, chemical
and petro chemicals, to consumer
durables,
fertilizers,
automobiles,
textiles etc.
The contribution of the capital
goods sector to growth of Index of
Industrial Production (IIP) has been
negative for the past two years.
Declining trends in investment, fall
in the growth of credit off-take and
low level of investment in R&D have
contributed to reduced growth rate
of capital goods sector from the high
of 48.5% in 2007-08 to contraction
of 4% and 6.3% in 2011-12 and
2012-13, respectively. During AprilJune 2013, the only capital goods
segment that has shown recovery in
domestic production is the electrical
machinery and apparatus segment
showing robust growth of 11.9%
during April-June 2013.
Hence, the potential of the capital
goods industry in India is still largely
untapped due to demand side as
well as supply side constraints.
Electrical Machinery:
Electrical
Machinery has 3 categories of

equipment: (a) Generation-Boilers,
Turbines
and
Generators,
(b)
Transmission-Transformers, and (c)
Distribution-Switch Gears and Control
Gears. The overall market which was
around $25 billion in 2012 is expected
to reach $100 billion by 2022.
India is the 5th largest power
producer in the world with 90,000 MW
of power produced as of May 2013.
Planned capacity addition of around
100,000 MW by 2022 would provide
significant opportunities in the sector.
Even then it is expected that total
power demand would reach around
350,000 MW by 2022.
The investments in R&D by the
electrical goods industry are amongst
the largest in the corporate sector
in India. Large electrical equipment
used in steel plants, petrochemical
in captive power plants are
manufactured in the country. The
domestic heavy electrical equipment
manufacturers are making use of the
developments of the global market
with respect to product designs and
upgrading of manufacturing and
testing facilities. They are making a
mark in transformer and generator,
electrical wire and cable exports. The
sector has also witnessed the entry
of a large number of players through
the JV route, even though 100% FDI is
permitted. More

A Few Prominent Indian Players
BHEL can deliver up to 20,000
MW of power generating equipment
per annum, which makes up around
10% of total installed capacity of
India (255GW). Hence, BHEL alone
can contribute to 10% growth of
power generation in India. However it
has installed power equipment of only
around 10,000 MW capacities in the
financial year 2012-2013.
•
The government’s 5-year plans
for increasing power production
are ambitious and they have
allocated a significant share to
NTPC, which in turn gets its work
done by BHEL.
•
Aging power plants would also
provide more scope for services
and spares. Government of India
has decided to provide more
autonomy to profit making PSEs,
BHEL being among them.
•
Increasing power demands of
African and CIS countries provides
opportunity for BHEL, especially
when BHEL already has presence
in many countries of these regions.
LT is a technology, engineering,
construction
and
manufacturing
company. It has a structure built on
several business units as pillars. They
are: (a) Hydrocarbon (b) Heavy
Engineering (c) Construction (d)
Power (e) Electrical Automation (f)
Machinery Industrial Products (g)
Information Technology (h) Financial
Services (g) Shipbuilding (h) Railway
Projects. It had a total revenue of
$28.3 billion in 2012-13. It caters to
all segments of heavy engineering
products and caters to the core
industry segment and the defense
sector in India.
Non Electrical Machinery
a)
Industrial Machinery : The
industrial
machinery
sector
is
comprised of all kinds of machinery
used by Indian industries like printing
machinery, pulp and paper machinery,
cutting
machines,
packaging
machines, laser machines, cleaning
machines, boring machines, pharma,
textile, cement, rubber etc.
The textile and garment makers of
India are eyeing 15-20% growth in
exports this year as the Government
is planning to implement some new
measures to boost exports and all

the segments of the textiles value
chain are doing well at present both
in the domestic and global markets.
The outlook for cement industry
continues to remain challenging with
both demand and prices continuing
to remain under pressure. Domestic
production grew by a modest 3.9%
during H1 FY'14 primarily due to weak
demand from end-user industries.
Overall the outlook for Industrial
Machinery is mixed with weakness in
Sugar and Earth Moving Machinery
also. Increasing global competition
and market demands require industrial
machinery companies to continuously
innovate and optimize their products.
To capture and leverage fresh valuecreating ideas is the need of the hour.
b)
Material Handling Equipment:
The size of material handling
industry in India is Rs 15,000 crore
growing by 15-20% a year. It has
been observed that changes in
material handling process can help
companies save a minimum 10% of
their materials that go waste or get
lost during transit. Cost-efficiency
and bottom lines can improve if
the organizations provide due
importance to material handling.
Material wastage is high in coal
and iron ore due to contamination,
pilferage or spillage during transit.
The sector would enjoy enormous
benefit by embracing modern
technology and making use of
special
conveyer
systems
.As
consumption goes up, there would
be more demand of minerals, energy
and water. So emphasis should
also be given on energy-efficient
systems that can consume less
water while handling of material. The
need of the hour is to optimize the
entire processes and the right kind
of material handling equipment.
India , MENA and Heavy Engineering
India will remain a top five trading
corridor for the UAE, Egypt and Saudi
Arabia, according to HSBC's latest
Trade Forecast report. By 2030,
the country will be the UAE's top
export destination accounting for
14% of exports, and Saudi Arabia's
second largest export destination
accounting for 18.5% of exports.
India is already Egypt's number one
export destination and will maintain
that position through to 2030,
accounting for 15.4% of exports.

India and UAE
Many Indian companies have
contributed to the growth of a
number of sectors in the region, like
power generation and transmission,
highways, telecommunication, water
and other infrastructure development.
The presence of warehouses of the
different Indian companies in UAE has
also resulted in an increase in the trade
not only with UAE but also with India’s
trade with other Gulf countries. UAE’s
investment in India were concentrated
mainly in five sectors: Power(18%);
Services(10%); Computer hardware
software(8%); Construction (8%); and
Tourism Hotels(6%).
India and Egypt
Indian companies have invested
in Egypt in manufacturing BOPET
BOPP films, Polyester Resin Bottles/
Containers, Power Transmission Towers,
Water Treatment, Two/Four Wheelers,
Irrigation Equipment, Anti-Pollution,
Anri-Collision Equipment etc. GAIL,
ONGC and GSPC also have a
presence in the country.
India and Saudi Arabia Exports
to Saudi Arabia: Main Indian
exports include Mineral Fuels, mineral
oils and products thereof; cereals;
nuclear reactors, boilers; electrical
machinery and equipment; Iron and
steel; organic chemicals; meat and
edible meat offal; articles of Iron or
steel; articles of apparel and clothing
accessories; etc.
Top items of Imports by India:
India’s major imports from Saudi Arabia
are Mineral Fuels, mineral oils and its
products; organic chemicals; plastic
and its articles; inorganic chemicals;
fertilizers; aluminium and its articles;
iron and steel; copper and its articles;
miscellaneous chemical products; etc.
Conclusion
As visible it is Heavy Engineering
which is binding India and MENA
together. This sector has a strong
support to put its expertise
in the service of the MENA
economy and the local people.
The facility has emerged as a
key platform contributing to the
progress, prosperity technology
development of MENA. It is very
important to focus on the growth
of this sector so that projections
are realized and do not remain on
paper only.

17
November 2013

than $3 billion of FDI has flown in
over the last decade in this sector.

A CII Bi-Monthly Journal on India – Gulf MEWANA Bilateral Ties

INFRASTRUCTURE

BUSINESS INFORMATION


MOROCCO
• Moroccan company is looking for tying up with an Indian counterpart to explore, extract and possibly process
A
minerals such as iron ore, copper, lead, barite, etc. Morocco offers several incentives in the mining sector, including
attractive rate of corporate taxation. Interested Indian companies may please send their interest to p.haridas@cii.in

November 2013

18

IRAQ

The state company for Iraqi Fairs Commercial Services has announced the Specialised International Exhibition
for Defence, Security and Aviation which will be held during March 1-4, 2014.This is a major opportunity for
reputed and specilised Indian companies to participate in this event and strengthen the trade ties with Iraq. For
any further information on this event, please contact falah.h@unfco.com; Ph: 009647806666661.

The Ministry of Trade / General Contracts Department has announced Tender No (MOT / Sunflower Oil / 8 /
2013) for purchasing the quantity of 10,000 MT +/- 5% Sunflower oil from all sources except Chinese as per
specifications laid down by the state company. The actual quantity will be specified by the buyer. Indian
companies are invited to participate in the tender. Details can be obtained from the legal department located
in Baghdad Al-Mansour near Baghdad International Fair Building against non refundable amount of $429. The
last date for receiving the offers is 10am, December 2, 2013 and others are valid to reply by December 6, 2013.
For any further information kindly contact www.irqitic.com and www.mot-gov.iq

The Ministry of Trade / General Contracts Department has announced Tender No (MOT / Sugar / 6 / 2013)
for purchasing the quantity of 50,000 MT +/- 5% Sugar from all sources except Thai as per specifications laid
down by the state company. The actual quantity will be specified by the buyer. Indian companies are invited to
participate in the tender. Details can be obtained from the legal department located in Baghdad Al-Mansour
near Baghdad International Fair Building against non refundable amount of $429. The last date for receiving
the offers is 10am, December 1, 2013 and others are valid to reply by December 6, 2013. For any further
information kindly contact www.irqitic.com and www.mot-gov.iq

Iraqi Ministry of Industry and Minerals / Public Relation has announced tender no. 13/T/FUR-1/2013 for operating
and supervising and consultancy for Soda and Chlorine Project / Investment Budgets / A/C 04.02.02.01.01.31.
Indian companies are invited to participate in these tenders.

Ministry of Electricity (MOE) / Minister Office Public Relation invites exclusively international manufacturing
companies to participate in the following tender: Reference No. 1163 for supplying Mobil Jet Oil for Al-Kahlaa
Power Station. For further information, contact www.elecgeepmi.com or email: geep_micomdep@yahoo.com
Ministry of Oil / Midlands Refineries Co. ‘ Daura Refinery invites bids for the following:
 eference No. 1335/2013 for supplying spare part for Pump (12 items). The last date for receiving the offers is December 16.
R
 eference No. 1331/2013 for supplying valve and fitting (14 items). The last date for receiving the offers is December 16.
R
R
R
 Reference No. 1612/2013 for supplying metals (49 items). The last date for receiving the offers is December 16.
For more details, contact www.oil.gov.iq; Email: purchase@mrc.oil.gov.iq
EGYPT

The Egyptian Government has invited a tender to develop the economic zone located at the north-west of Swes
Gulf and the last date for bidding is December 31, 2013. For more details, check www.mdc.egypt.org
 gyptian National Railways Purchase and Store Dept to supply tyres 692 MM inside diameter as rolled for
E
wagon. The technical envelop will be opened on December 11, 2013 in Cairo. Fax: +202-25761337.
LIBYA
 he Almazaya Group in Tripoli seeks to connect with an environmental contractor for oil tank cleaning
T
projects. For more details, contact Mohammed Taher Angar, G.M. Almazaya Group - Tripoli, Libya;
Ph: +218-91-634-0123

For further details please contact Mr Gurpal Singh, Confederation of Indian Industry (CII), 249-F, Sector 18, Udyog Vihar, Phase IV,
Gurgaon 122015, (Haryana, India); tel: +91(124) 4014060-67; Fax: +91(124)4014080; email: gurpal.singh@cii.in
Copyright 2013 by Confederation of Indian Industry (CII), All rights reserved.
DISCLAIMER: No part of this publication may be reproduced, stored in, or introduced into a retrieval system, or transmitted in any
form or by any means (electronic, mechanical, photocopying, recording or otherwise), without the prior written permission of the
copyright owner. CII has made every effort to ensure the accuracy of information presented in this document. However, neither CII
nor any of its office bearers or analysts or employees can be held responsible for any financial consequences arising out of the
use of information provided herein. However, in case of any discrepancy, error, etc., same may please be brought to the notice of
CII for appropriate corrections.
Published by Confederation of Indian Industry (CII), The Mantosh Sondhi Centre; 23, Institutional Area, Lodi Road, New Delhi-110003
(INDIA), Tel: +91-11-24629994-7,Fax: +91-11-24626149; Email: info@cii.in; Web: www.cii.in



20
19

September 2013

November 2013

UPDATE
UPDATE

Prism, November 2013

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