India-Qatar trade expands beyond energy to AI, semiconductors

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India is expanding its trade relations with Qatar by moving beyond traditional energy exports and collaborating on new sectors like artificial intelligence (AI), semiconductors, quantum computing, and the Internet of Things (IoT).

At the invitation of Indian Prime Minister Narendra Modi, His Highness the Amir of the State of Qatar, Sheikh Tamim bin Hamad Al-Thani, paid a State Visit to India on February 17 and 18. HH the Amir was accompanied by a high-level delegation comprising ministers, officials and business leaders. This was the second State Visit of HH the Amir to India, according to the India-Qatar joint statement.

“We welcome energy products coming in from Qatar, but I think we are now looking at a new future where we will transition from energy being the bulwark of our trade to AI, Internet of Things, quantum computing, and semiconductors,” India’s Commerce Minister, Piyush Goyal, said at the inaugural session of India-Qatar Business Forum.

The Qatar delegation praised India’s efforts in creating a favorable environment for Foreign Direct Investment (FDI) and Foreign Institutional Investment (FII) and expressed interest in exploring investment prospects across various sectors, including infrastructure, technology, manufacturing, and other mutually beneficial areas. In this regard, Qatar committed to invest $10 billion in India. Both nations set a target to double bilateral trade by 2030.

In a statement, India’s Ministry of Commerce & Industry said that bilateral trade exceeded $15 billion in FY 2023-24, and investment flows have risen, positioning Qatar among India’s top three GCC investors. GCC investors are investors in the Gulf Cooperation Council (GCC) countries, which include Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates. However, there is still considerable untapped potential.

“The whole world is going through a major shift. Geopolitical tensions around the world have given us a lot to think about,” Goyal said.

“There’s a big focus on localization around the world and more and more countries are getting into self-reliance.”

Goyal reaffirmed India’s ambition to become a $30-35 trillion economy by 2047, in alignment with the Viksit Bharat (developed India) vision. With each country possessing distinct competitive advantages, Goyal stressed that India and Qatar are in a position to complement each other’s strengths and can be partners in driving innovation.

As both nations embark on a transformational transition, Goyal said this partnership will rest on the pillars of entrepreneurship, technology, and sustainability.

The road ahead

According to the joint statement, India and Qatar signed and exchanged several documents, which is expected to further deepen their bilateral relationship and open avenues for newer areas of cooperation. Both nations signed the ‘Agreement on the Establishment of Bilateral Strategic Partnership’ to enhance and strengthen their multifaceted relationship. With the formation of this new partnership, both nations reaffirmed their dedication to deepening bilateral ties through consistent and organized collaboration across various sectors, including trade, investment, energy, education, technology, innovation, sustainability, and people-to-people connections.

Both countries have signed the revised ‘Double Taxation Avoidance Agreement’ and agreed to fast-track discussions on the ‘India-Qatar Bilateral Investment Treaty.’

India’s UPI to expand in Qatar

Qatar is looking to implement a nationwide rollout of India’s Unified Payments Interface (UPI) acceptance in Qatar, according to the joint statement. So far, UPI is operational in Qatar National Bank’s (QNB’s) points of sales. The QNB-National Payments Corporation of India (NPCI) partnership is expected to further enhance digital payments through QR code-based UPI transactions.

India’s flagship UPI, an example of effective Digital Public Infrastructure (DPI), is recognized as one of the world’s most successful real-time payment systems. In July last year, NPCI International Payments Limited (NIPL) signed an agreement with QNB, the largest financial institution in the Middle East and Africa, to introduce QR code-based UPI payments nationwide. This initiative marked a significant milestone by enabling UPI payment acceptance in Qatar through the QNB merchant network, thereby benefiting Indian travelers visiting and transiting through the country.

Both countries also agreed to explore the settlement of bilateral trade in respective currencies. India has also welcomed QNB’s expansion by setting up an office in India’s GIFT City (Gujarat International Finance Tech City).

India and Qatar seek deeper collaboration in technology and innovation, including emerging technologies and startups. The two nations also discussed avenues for furthering e-governance and sharing best practices in the digital sector.

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