By Ben Flanagan
UAE Economy Minister proposes new economic ties; Indians in the Gulf to send back $20bn in remittances in '07.
India and the Arab countries should move towards an economic bloc uniting the two regions, according to UAE Economy Minister Sheikha Lubna bint Khalid Al Qasimi.
"I believe such a bloc could result in the outcomes we both seek - prosperity and growth over the long term," said Sheikha Lubna at the opening of the 6th Indo-Arab Conference and the Exhibition of Indian Products, held at Sharjah Expo Centre.
In her speech – which was reported by the Emirates News Agency, WAM – Sheikha Lubna also noted that India was striding confidently to become one of the world's leading economies as the country posted 8.9% growth in national income during the first quarter of 2006.
Sheikha Lubna cited population concerns and the need to create new jobs as the key challenges facing both India and Arab countries.
She also said that foreign direct investment (FDI) from the GCC was only about $2 billion in 2006 and “this figure needs to grow exponentially in the coming decade,” reported Gulf News.
“Investment is often hampered and if [India] is to replicate the success of its IT and outsourcing industries elsewhere in its economy it must lower barriers to trade and encourage foreign investment in other sectors,” the newspaper quoted Shaikha Lubna as saying.
Whether this is a suggestion that a future Free Trade Agreement between the UAE and India may be on the cards is not clear. Talks have previously been held on a possible FTA between the two countries.
The strength of economic ties between the two regions was illustrated by Sheikha Lubna, who claimed that the six million Indians living in the Gulf will transfer a total of about US$20 billion home this year, equating to an average of US$3,333 each.