Diplomatic Enclave, Arabian Gulf Street, P.O. Box 1450, Safat-13015, Kuwait. Phone: 22530600, 22530612 - 14 Fax: 22546958, 22571192, 22573910, 22573902
Brief on India-Kuwait Trade and Economic Relation
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Brief on India-Kuwait Economic and Commercial Relations

Kuwait is a small, rich, relatively open, petroleum-based economy. It has estimated crude oil reserves of 102 billion barrels or about 6% of world reserves. Oil revenues constitute the main source of income and amount to approximately 90% of the state’s revenues. During 2015, Kuwait’s total exports were KD 16.6 billion (US$ 54.61 billion) of which oil exports amounted to KD 14.7 billion (US$ 48.36 billion) while non-oil exports were KD 1.9 billion (US$ 6.25 billion) and its total imports were KD 9.6 billion (US$ 31.58 billion). Due to a decline in oil export earnings, Kuwait’s trade surplus shrank from KD 20 billion (US$ 65.94 billion) in 2014 to KD 7 billion (US$ 23 billion) in 2015 (20% of projected GDP). According to IMF estimates, Kuwait’s Nominal GDP in 2015 was US$ 120.682 billion and GDP per capita (PPP) was US$ 70,165.99. It has a Sovereign Wealth Fund (SWF) of over US$ 592 billion, which is managed by the Kuwait Investment Authority (KIA). Kuwait offers an open, competitive and affluent market for consumer goods and project exports. The climate in Kuwait is not suitable for agriculture; resultantly, most of its requirements are imported. To meet its need for potable water, Kuwait depends on either desalination or import.

Kuwait is a relatively diverse project market. Kuwait embarked on its Development Plan (2015-2020) under which it is expected to award contracts worth over US$ 115 billion in various sectors. The projects would cover a wide range and include oil and gas sector both upstream and downstream, construction, including new cities, hospitals and housing units, infrastructure, including roads, airport, port, metro and railway projects, power and transmission, petrochemicals, gas processing, pipeline, etc.

Historically, Indo-Kuwaiti relations have always had an important trade dimension. India has consistently been among the top ten trading partners of Kuwait. Kuwait has been a reliable and fourth largest supplier of crude oil to India. During 2015-16, Kuwait was the seventh largest oil supplier to India and it meets about 5.5% of India’s energy needs. Total bilateral trade with Kuwait during 2015-16 was US$ 6.2 billion and for 2016-17 (April-January) was US$ 4.72 billion. The trend of bilateral trade during the years 2011-12 to 2016-17 (Apr- Jan) is as follows:

India-Kuwait Bilateral Trade FY 2011-12 to 2015-16
in US$ million

 

2011-2012

2012-2013

2013-2014

2014-2015

2015-2016

2016-17 (Apr- Jan)

India’s Exports to Kuwait

1,181.41

1,061.08

1,061.14

1,198.91

1,247.25

1,229.28

India’s Imports from Kuwait

16,439.64

16,588.13

17,153.55

13,381.97

4,962.33

3,491.30

Total

17,621.05

17,649.21

18,214.69

14,580.88

6,209.58

4,720.58

Source: M/o Commerce & Industry, India

 

Note: Note: POL imports accounted for US$ 15,731.38 million in the year 2011-12; US$ 15,737.46 million in the year 2012-13; US$ 16,121.81 million in the year 2013-14; US$ 12,228.71 million in 2014-15; and US$ 4,052.24 million in 2015-16.

Non-Oil Bilateral Trade

India-Kuwait Non-Oil Trade FY 2011-12 to 2015-16

 

2011-12

2012-13

2013-14

2014-15

2015-16

2016-17 (Apr- Jan)

India’s Exports to Kuwait

1,174.66

1,046.77

1,049.42

1,189.78

1,240.54

1,219.69

India’s Imports from Kuwait

708.26

850.67

1,031.74

1,153.26

910.09

797.59

Total

1,882.92

1,897.44

2,081.16

2,343.04

2,150.63

2017.28

Source: Ministry of Commerce & Industry, India.

Total non-oil bilateral trade between India and Kuwait decreased by about -8.21%, i.e., from US$ 2,343.04 million in 2014-15 to US$ 2,150.63 million in 2015-16. Meanwhile, India’s non-oil exports to Kuwait are showing a positive trend for the past few years. Non-oil export from India to Kuwait increased by about 4%, i.e., from US$ 1,189.78 million in 2014-15 to US$ 1,240.54 million in 2015-16.  

India’s Exports to Kuwait

Our exports to Kuwait in the last five years are over US$1 billion. During 2015-16, major items exported from India to Kuwait covered a broad range including food items, cereals, textiles, garments, electrical and engineering equipment, pressure vessel reactors, industrial valves, boilers, machinery and mechanical appliances, cars, trucks, buses, tyres, chemicals, jewellery, handicrafts, metal products, iron and steel, etc.
India’s Imports from Kuwait

India’s imports from Kuwait during 2015-16 were US$ 4.96 billion of which POL accounted for US$ 4.05 billion (Crude oil import was worth US$ 3.58 billion). The reduction in Kuwait’s exports to India, compared to 2014-15, was due to the sustained low crude oil price and reduced purchase of crude oil from Kuwait by Indian oil companies, both in Public and Private sectors. Major imports from Kuwait (excluding Petroleum & its products) were organic chemicals, plastic and its articles, iron and steel, aluminum and copper and articles thereof; salt; sulphur; earths and stone; plastering materials; lime and cement, pulp of wood, etc.

 

 


Recent High-Level visit

 

Kuwaiti PM’s visit to India: HH the Prime Minister of Kuwait, Sheikh Jaber Al Mubarak Al Hamad Al Sabah led a high-level delegation on an official visit to India from November 7-10, 2013. During the visit, the Kuwaiti PM called on President Shri Pranab Mukherjee, Vice President Shri Hamid Ansari. A delegation level talk co-chaired by the Prime Ministers of India and Kuwait was also held. Besides meeting the Ministers of Finance, External Affairs, Commerce & Industry and UPA Chairperson Mrs. Sonia Gandhi, he also had a meeting with the members of Federation of Indian Chambers of Commerce & Industry (FICCI), Confederation of Indian Industry (CII), and Associated Chambers of Commerce and Industry of India (ASSOCHAM). During the visit, five bilateral cooperation agreements/MOUs covering - transfer of sentenced persons, cooperation between Foreign Service Institute (FSI) of India and Kuwait Diplomatic Institute, sports and youth affairs cooperation, executive programmes for culture and education for the period 2013-2016 – were also signed.

 

Other recent bilateral exchanges / meetings

From Kuwait, Mr. Mohammad Abdullatif Al-Farhoud, CEO, Petrochemical Industries Company (PIC), Kuwait along with a delegation from KCCI attended the 8th Vibrant Gujarat Global Summit which was held from 10-13 January 2017 in Gandhinagar, Gujarat; the 5th JWG on Labour, Employment and Manpower Development was held in New Delhi from 14-15 December 2016 wherein bilateral labour and consular issues were discussed; Mr. Nizar Al-Adsani, CEO of Kuwait Petroleum Corporation (KPC) accompanied by two members of KNPC, including the Deputy CEO of Al-Ahmadi Refinery, attended the PETROTECH-2016 at New Delhi from 5-7 December 2016; the 3rd round of India-Kuwait Foreign Office Consultations was held in New Delhi on 16 November 2016; the Kuwaiti delegation was led by Assistant Foreign Minister Mr. Ali Al-Saeed and also included Ambassador of Kuwait to India Fahad Ahmad Al-Awadi. In addition to bilateral political and regional issues, the main focus was on labour and Consular related issues along with the commitment to explore avenues for investment and enhancement of trade between the two countries; Dr Bader Hamad Al-Essa, Minister of Education and Minister of Higher Education participated in the UNESCO International Conference on the Prevention of Violent Extremism through Education in New Delhi from 19-20 September 2016; and a 10-member Kuwaiti delegation led by Sheikh Youssef Al-Sabah, Director General, Kuwait Port Authority participated in the Maritime India Summit in Mumbai from 14-16 April 2016; and a Kuwaiti Health Ministry delegation led by Assistant Undersecretary Dr. Jamal Al Harbi visited Kerala on 15 April 2016 and met the Kerala Chief Minister and NORKA Minister Shri K.C. Joseph. A two-member Youth Delegation from Kuwait visited India from 9-15 March 2016 under the Youth Exchange Programme; A three-member Kuwaiti delegation led by Asstt Director General of the National Council for Culture, Arts and Letters (NCCAL) Dr. Bader Al-Duweesh participated/represented the Kuwaiti Information Minister Sheikh Salman Sabah Al-Salem Al-Humoud Al-Sabah in the World Cultural Festival, organized by the Art of Living Foundation from 11-13 March 2016 in New Delhi. Dr. Abdulmohsen Medeij Al-Medeij, Minister of Commerce & Industry led a business delegation to India for the 21st edition of the Partnership Summit held in Jaipur, Rajasthan on 15-17 January 2015, as well as to the 4th India-Arab Partnership Conference held in New Delhi on 26-27 November 2014; and Minister of Amiri Diwan Sheikh Nasser Sabah Al-Ahmad Al-Jaber Al-Sabah visited India in March 2013.

From India, at the invitation of the President of National Security Bureau of Kuwait, a high level delegation led by NSA arrived in Kuwait for two day's official visit from 13-14 March, 2017 to participate in the 3rd bilateral security dialogue; a 4-member delegation led by Shri Naini Narshimha Reddy, Labour & Home minister of Telangana & Chairman of Telangana Overseas Manpower Co. Ltd (TOMCOM) visited Kuwait on 21 January 2017 to explore manpower opportunities in healthcare, hospitality and construction sectors in Kuwait; A 12-member business delegation from Gujarat led by Dr Rajiv Kumar Gupta, IAS, Principal Secretary to the Government of Gujarat and Managing Director, Gujarat Narmada Valley Fertilizers and Chemicals Ltd visited Kuwait from 9-10 October; a 3-member delegation led by Shri Ashwini Attri, Additional Deputy Comptroller & Auditor General (Southern Region), Office of the Comptroller & Auditor General of India, New Delhi visited Kuwait from November 7-10, 2016 to participate in the 8th Indo-Kuwait Joint Seminar on “Role of SAIs in Good Governance”; Gen. V.K. Singh (Retd.), Minister of State for External Affairs visited Kuwait from 6-7 September 2016 to meet Deputy PM and Foreign Minister, Deputy Foreign Minister, Minister of Social Affairs & Labour and Governor of Farwaniya. During the visit, Hon’ble Minister also unveiled the life-size bronze statue of Mahatma Gandhi at the Embassy complex. Dr. Montek Singh Ahluwalia, Deputy Chairman Planning Commission visited Kuwait in July 2013. In 2014, bilateral meetings under the existing framework of institutional mechanism such as the 2nd Foreign Office Consultations (11 September 2014), the 4th meeting of the Joint Working Group on Labour, Employment and Manpower Development (16 June 2014), the 3rd meeting of the JWG on Hydrocarbon (24-25 June 2014), the meeting to discuss the Protocol amending the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to taxes on income (24-25 August 2015) were held in Kuwait while the 4th meeting of the JWG on Hydrocarbon (15-16 September 2015) was held in New Delhi. On 21 January 2016, Shri K.C. Joseph, Minister for Non-Residents Keralites’ Affairs accompanied by Secretary, NORKA, CEO, NORKA visited Kuwait on the issue of recruitment of Indian nurses for work in Kuwait. Two Indian Naval ships ‘INS Deepak’ and ‘INS Tabar’ made goodwill visit to Kuwait from 13-16 September, 2015 followed by another visit by three Indian Naval Ships ‘INS Deepak’, ‘INS Delhi’ and ‘INS Tarkash’ from 12-15 May 2016.


Agreements between India and Kuwait in the Economic Field
  • • Trade Agreement signed in February 1974.
  • • Cooperation Agreement for the Promotion of Economic, Commercial and Technical Cooperation signed in February 1992.
  • • Agreement for Encouragement and Reciprocal Protection of Investment signed in November 2001 and ratified in June 2003.
  • • Agreement on Juridical and Judicial Cooperation in Civil and Commercial Matters signed in August 2005 and ratification process completed in June 2009.
  • • Agreement on Drug Demand Reduction and Prevention of Illicit Trafficking in Narcotic Drugs, Psychotropic Substances and Precursor Chemicals and Related Matters was signed in June 2006 and ratification process was completed in July 2012.
  • • MOU on Labour, Employment and Manpower Development signed in April 2007.
  • • MOU on Civil Aviation between India and Kuwait authorities, latest one signed in June 2007.
  • • Agreement on the Avoidance of Double Taxation and Prevention of Fiscal Evasion of Taxes on Income signed in June 2006.
  • • Agreement on Scientific and Technological Cooperation signed in April 2009.
  • • MOU on Medical Cooperation signed in April 2012.
  • • MOU on Youth Affairs and Sports signed in November 2013.
  • • MOU between CSIR and KISR on S&T cooperation signed in November 2013.
  • • MOU between KISR and Earth Systems Science Organization, Ministry of Earth Sciences on cooperation in S&T signed on 16 October 2014.
  • • MOU between KISR and Indian Space Research Organization for Cooperation in the Exploration and Use of Outer Space for Peaceful Purposes on 30 September 2015.
  • • The Protocol amending the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income between India and Kuwait, on 15 January 2017

Kuwaiti investments in India

Kuwait’s Sovereign Wealth Fund (SWF) is valued over US$ 592 billion and is managed and invested by the Kuwait Investment Authority (KIA). These assets are held in 2 state-owned sovereign funds: the Reserve Fund for Future Generations (RFFG) and General Reserve Fund (GRF) to which Kuwait has been transferring 10% of its total revenues since October. KIA until some years back was investing only in OECD economies. Now they have started taking some exposure in the developing countries. So far, investments in India are about US$ 3 billion. In December 2015, KIA announced an investment of US$ 300 million in GMR Infrastructure Ltd. KIA also made some investment in the Interglobe Aviation’s (Indigo Airlines) IPO in October 2015. Earlier, in 2013, KIA had made an investment of US$ 5.37 million in the Power Grid Corporation of India Ltd. On 28 November 2015, Kuwait’s National Petroleum Services Company (Napesco) opened their first company in India, ‘Napesco India’, a limited liability company with a capital of about Rs.50 million (USD 7.8 lakh) at Chennai Special Economic Zone. India is looking for a substantial Kuwaiti investments in oil & gas sector. Large business houses of Kuwaiti also have investible surpluses. As a follow up to the visit of Minister of Amiri Diwan, Sheikh Nasser to India in March 2013, Deputy Chairman, Planning Commission visited Kuwait from July 1-3, 2013 with a delegation during which detailed discussions were held with KIA. IDFC, IL&FS and L&T Infra also made presentations.

As a follow up to the visit of His Highness the Prime Minister of Kuwait to India on November 7-10, 2013, an investment delegation led by Secretary (Disinvestment), Mr. Ravi Mathur, visited Kuwait on November 13, 2013 and discussed investment opportunities in India with KIA team led by its Managing Director H.E. Mr. Bader Al-Saad.

Significant Kuwaiti presence in India includes those by Alghanim Group of Kuwait; KAPICO group; National Aviation Services; Agility Logistics, Hasibat Holding Co, KGA Group, KCIC, KIPCO, Global Investment House, Kuwait Finance House, Noor Investment, etc. among others. Several India-related funds have been launched in Kuwait in the past few years and among them are India Fund (first Sharia compliant India-focused fund); Tijari India Fund (launched by the Commercial Bank of Kuwait); India Equity Fund (Sharia compliant fund launched by the Kuwait and Middle East Financial Investment Company); Kuwait India Holding Company (Sharia compliant; launched by Noor Financial Investment Company); Indian Private Equity Fund (Sharia compliant fund launched by the Khaleej Finance and Investment of Bahrain, Kuwait Investment Company and Kuwait Finance House); India Private Equity Fund (launched by National Bank of Kuwait); and 3rd Real Estate Islamic Fund (Sharia compliant fund launched by National Bank of Kuwait for China and India).

UTI Asset Management Company in July 2009 set up a US$ 500 million infrastructure - focused private equity fund - the India Infrastructure Development Fund (IIDF) - in association with Noor Financial Investment Company of Kuwait (NOOR) and HSH Nordbank of Germany.

Indian Investments in Kuwait


Indian public and private sector companies in the finance and insurance sector which have investments in Kuwait are - LIC (International), LIC Housing Finance, New India Assurance, Oriental Insurance Company, HDFC Ltd. These companies are present in Kuwait for many years. They have their offices in Kuwait, in association with local sponsors, as per prevailing regulations.

Presence of Indian Corporate Sector in Kuwait
Major Indian commercial activities in Kuwait include those by L&T, Shapoorji Pallonji, Dodsal, Kalpataru Power Transmission Ltd, TERI, Essar Projects, Simplex Projects, Bridge & Roof, Tata Consultancy Service (TCS), WIPRO, Tech Mahindra and Infosys. Many Indian banks have agreements with major Exchange Houses in Kuwait to facilitate remittances into India. The following Indian companies have a presence in Kuwait:

  • Larsen & Toubro Limited

 

  • Essar Projects Limited

 

  • Punj Lloyd
  • Shapoorji Pallonji

 

  • Kalpataru Power Transmission Ltd

 

  • Indian Office of Japan’s Toyo Engineering Co.

 

  • The Energy Resource Institute (TERI)
  •   Dodsal

 

  • Afcons
  • KEC International Limited, Mumbai (an RPG Group Co.)

 

  • Simplex Projects
  • TATA Consultancy Services

 

  • WIPRO
  • Infosys

 

  • Tech Mahindra
  • HDFC Limited

 

  • UTI Asset Management Company
  • Apollo Hospital group and Fortis Group of India

 

  • Himalaya Pharmaceutical

 

  • Bridge & Roof Company Limited
  • Gulf Jyoti International LLC, Dubai

 

  • Shalimar Valves

 

 

Projects awarded to Indian companies in Kuwait
During the last two years 2014-15, leading Indian companies viz. L&T, Shapoorji Pallonji, Dodsal, Punj Lloyd, Essar, Kalpataru Transmission Ltd. and Simplex Projects were awarded EPC contracts worth over US$ 5 billion in Kuwait. The Energy Resource Institute (TERI), New Delhi is already doing a pilot project worth US$ 39 million in the field of soil remediation with Kuwait Oil Company (KOC).

 

Indian Public Sector Undertakings (PSUs) in Kuwait

  • TCIL has significant presence in Kuwait since 1978
  • LIC (International),
  • LIC Housing Finance Company,
  • New India Assurance Company,
  • Oriental Insurance Company and
  • Air India Limited (Air India and Air India Express)
  • ONGC TERI Biotech Ltd (OTBL)

Business activities of Indian Community in Kuwait

The Indian community with a strength of about 9.2 lakh is the largest expatriate community in Kuwait and is regarded as the community of first preference among the expatriate communities. Professionals like engineers, doctors, chartered accountants, scientists, software experts, management consultants, architects; technicians and nurses; retail traders and businessmen are present in Kuwait, though a large proportion consists of unskilled and semi-skilled workers. The total annual remittance from Kuwait to India is estimated at about US$ 5 billion.

Indian Business Community in Kuwait has carved a niche in the Kuwaiti market in retail as well as distributorship. Many of the business houses are present in Kuwait for three-four generations. Four Indian businessmen from Kuwait figured in a report by Forbes, "100 top Indian leaders in the Arab World 2015.”

The Indian Business and Professional Council (IBPC) an association of about 148 businesspersons in Kuwait who are actively involved in promoting India-Kuwait business relations.

Presence of NRI owned retail outlets like Lu&Lu, Gulf Mart, City Centre and Centre Point, as well as large NRI owned distributor companies have contributed to a growing range of Indian products in Kuwait and has helped meet the requirements of the large Indian community in Kuwait.

Air connectivity between India and Kuwait

Air India, Air India Express, Jet Airways and Kuwait Airways operate flights between various cities in India and Kuwait. The details viz. name of airline, cities connected in India and frequency of flights are given below:

S.No

Cities

Kuwait Airways

Air India

Air India Express

Jet airways

1

Ahmedabad

6 flights a week
(Sun, Mon, Tues, Thurs, Fri & Sat)

2 flights a week
(Mon & Fri)

2

Bangalore

5 flights a week
(Mon, Wed, Thurs, Sat & Sun)

3

Chennai

5 flights a week
(Sun, Tues, Wed, Thurs & Sat)

Daily Flight

4

Delhi

2 Daily Flight

 

5

Goa

3 flights a week (Tues, Thurs, Sat)

6

Hyderabad

2 flights a week
(Wed & Sun)

7

Kochi

1 Daily flight plus 1 flight on Mon, Thurs & Sat

 

3 flights a week via Kozhikode
(Tue, Thurs, Sun)

8

Kozhikode

3 flights a week
(Tue, Thurs, Sun)

9

Mangalore

 3 flights a week
(Mon, Wed & Fri)

10

Mumbai

2 Daily Flight

1 flights daily

11

Thiruvananthapuram

6 flights a week
(Sun, Mon, Tues, Wed, Fri & Sat)

10 May 2017

Two private Indian airlines, namely, GoAir airlines & IndiGo,  have been permitted by Civil Aviation authorities to start their flights to Kuwait. Further, Kuwait Airways have proposed a code-share arrangement with Air India, a proposal which is under consideration with Air India.

 



Air India has a rich mix of wide and narrow body aircrafts ranging from Boeing 747, Dreamliners, Airbus 320 to smaller CRJ-700 aircrafts. It has a wide network flying to 31 international and 59 domestic destinations over 4 continents. It connects many more destinations through code-share arrangements with various airlines.
LIC (international) BSC(c) is a subsidiary of LIC of India, a corporation established through an act of Gov. of India. LIC(International) started its activities in Kuwait in the year 1996 through its chief agent M/S.Warba Insurance Co.SAK, later in the year 2006, expanded by opening the marketing office of M/S.Warba Insurance Co.SAK, at Fahaheel.
Jet Airways, is India’s premier international airline and was founded in 1993. Over the years Jet Airways has constantly endeavoured to give the world a world-class airline and has been recognised and honoured constantly for this.
The Oriental Insurance Company Limited is one of the 4 Public Sectors (Government) Insurance Company’s of India, one of the four giants in Insurance World of India. Since, 1947 Oriental is underwriting a large number of risks starting from cattle to space, through its more than 1000 Offices in India.
New India Assurance Co Ltd, is a 100 % Govt of India owned multinational General Insurance Company operating in 27 countries and headquartered at Mumbai, India. Our global business crossed Rs.16000 Cr.
TCIL, a prime engineering and consultancy company, is a wholly owned Government of India Public Sector Enterprise under the administrative control of the Department of Telecommunications (DOT), Ministry of Communications and Information Technology, Government of India.