India and the Abraham Accords

Context: Israeli foray into the Gulf could disrupt the politico-economic architecture India has built with the Gulf Cooperation Council (GCC).

Analysis of the geopolitical situation in West Asia:

• The Abraham Accords: Recently, Israel marked its formal normalization of relations with the United Arab Emirates (UAE) and the Kingdom of Bahrain.

• The two Gulf states have, thus, joined Egypt and Jordan, which had their peace treaties with Israel in 1979 and 1994, respectively.
• Although formally committed to an Arab consensus over a two­state resolution of the Palestine cause, these two countries have moved towards having substantive links with Israel in recent years.

• Multiple drivers spurring the relationships:

• Common treat perception: concerning Iran against the backdrop of the ongoing decline of the United States in the region.

• Relatively modern societies: which share the overarching and immediate priority of post­pandemic economic recovery.

• They have lost no time to set up logistics such as Internet connectivity and direct ?ights to pave the way for more active economic engagement. 

India’s stakes in the region:

• Diaspora and remittances: With over eight million Indian diasporas in the Gulf remitting annually nearly $50 billion,

• Trade and investments: Annual merchandise trade of over $150 billion, sourcing of nearly two­thirds of India’s hydrocarbon imports and major investments.

• Indians are also the biggest stakeholders in Dubai’s real estate, tourism and Free Economic Zones.
• India has acquired a large and rewarding regional footprint, particularly as the preferred source of manpower, food products, pharmaceuticals, gem and jewellery, light engineering items.

Implications on India’s politico-economic architecture in West Asia due to Arab-Israel Ties:

• Opportunities: 

• Ease of India’s diplomatic balancing act: the Israel-GCC breakthrough widens the moderate constituency for peaceful resolution of the Palestine dispute.

• Challenges:

• Security concerns threatening India’s interest:

• May provoke new polarizations: between the Jihadi fringe and the mainstream.

• Risk of proxy war: The possibility of the southern Gulf becoming the new arena of the proxy war between Iran and Israel cannot be ruled out, particularly in Shia pockets.

• Economic fallout for India: With Israel closer partnership with the GCC, India’s economic stakes are threatened.

• The UAE and Bahrain can become the entrepôts to Israeli exports of goods and services to diverse geographies.
• Israel has niche strengths in defence, security and surveillance equipment, arid farming, solar power, horticultural products, high­ tech, gem and jewellery, and pharmaceuticals.
• Israel has the potential to supply skilled, and semi­skilled manpower to the GCC states, particularly from the Sephardim and Mizrahim ethnicities, many of whom speak Arabic.
• Israel is known as the start­up nation, and its stakeholders could easily ?t in various duty-free incubators in the UAE.

Conclusion: In the evolving scenario, there may be scope for a pro?table trilateral synergy, but India cannot take its preponderance as a given. It needs to keep its powder as dry as the shifting sands of the Empty Quarter.