Impact of Qatar Chaos on India

Impact of Qatar Crisis on India

Impact of Qatar Crisis on India

Just a few days ago, Saudi Arabia and few other Arab countries severed all diplomatic ties with Qatar. This move was taken to isolate the nation. Though, India has termed this as an internal matter of Gulf Cooperation Council (GCC), yet, experts are of the opinion that this will have a bearing on India-Qatar relationship. Let us see how the impact of Qatar chaos will affect India-Qatar ties.

  • Bilateral trade between India and Qatar: The Bilateral trade between India and Qatar has progressed over the years. In 2013-14, it showed an all-time high when it touched $ 16.68 billion.  In 2015-16, the total bilateral trade reached $15.67 billion. In the last two years, imports in value terms have declined. This was because of the decrease in prices of international oil and gas.  India is in the need for at least $ 1 trillion in the coming 5 years for development of infrastructure alone. Qatar Investment Authority (QIA) can invest significantly in this sector. Efforts are been made to engage with QIA and other state-owned and private entities in Qatar for investing in India.
  • India’s corporate sector: The Gulf-Qatar separation will send a warning message to corporate sector in the country. Many Corporates have expanded their businesses in Qatar for its vast potential. Some prominent Indian companies which have businesses in Qatar are L&T, Punj Lloyd, Shapoorji Pallonji, Voltas, HCL, MahindraTech. Few Indian banks such as SBI, ICICI have also their branch offices under the Qatar Financial Centre or private exchange houses in Qatar. L&T won a QR 2.1 billion road project in Qatar in March 2014. It also secured an order worth $740 million from Qatar Railways.
  • Bilateral Relations between India and Qatar: On June 4, 2017, PM Narendra Modi had paid an official visit to Doha on being invited by the Emir of Qatar. The Emir had himself visited in March 2015 and his father has been a regular visitor to our country. The two countries share a cordial relation and this has been intensified by more support to diverse sectors.
  • Military Relations between India and Qatar: India has major military relations with Qatar. The two countries are in a maritime defense agreement to combat threats from extremist elements.
  • Oil and Gas Prices: Qatar is a major source for liquid gas but it does not export any oil. As a result, oil imports will remain unaffected. Qatar’s rift with its neighboring Arab countries will not immediately impact India’s import of gas from that country. However, with the rise in crude oil, it will impact pricing and affect New Delhi’s oil import bill. In 2016, India had renegotiated its 25-year LNG contract with Qatar to bring a slide in global oil prices. While the supplies of oil and gas will not be affected, shipments of oil may be a problem. A rise in gas price will reduce the government’s scope of spending more on welfare programs. That is why there might be a crisis in the long run as the government of India is working upon low gas prices to make way for a gas-based economy.
  • Travel problem: Travel within the region from Doha is likely to be a big problem in the immediate future. Qatari citizens have been given 14 days time to return to their home country. More than 6 lakhs Indian citizens are living in Qatar at present. Almost half of the Indian population in Qatar is from Kerala. The chief minister of the state has requested Prime Minister Narendra Modi to ensure the safety of these NRIs. Qatar Airways at present has 102 weekly passenger flights to 13 Indian cities.
  • Job problems: There will be major upheavals in the job and education sector. Most of the Indians staying there will have to leave their jobs. About 30,000 Indian students study there in 14 schools affiliated to the CBSE curriculum.


Whether the Qatar crisis will affect India or not, only time will tell. For the Government of India, this is a temporary problem, an internal problem of GCC. The GOI has assured that it won’t impact India immediately. But, going by India’s terms with Qatar, if the isolation continues for a very long time, India will definitely be affected in trading, services, jobs, prices of oil and gas and so on. In the meantime, External Affairs Minister Sushma Sawraj has assured that the ministry will take all the necessary measures to save the lives of many Indians in distress. If the situation worsens, ministers of state in the ministry of external affairs could be sent to Qatar for a direct diplomatic intervention.