Trade regulations and agreements between Saudi Arabia and India

Relations between the Kingdom of Saudi Arabia and the Republic of India are tight and strong. Their trade reaches around US$27 billion a year. Saudi Arabia’s exports to India are around US$22.00 billion. India’s exports to Saudi Arabia are close to US$5.50 billion. Such a large exchange of goods and services needs a good foundation. So let’s learn something about trade regulations and agreements between Saudi Arabia and India.

A shipping port you can use for shipping your items if you are familiar with Trade regulations and agreements between Saudi Arabia and India.

Sea transportation is essential for trade

Historic ties between Saudi Arabia and India

Cultural and trade ties between Saudi Arabia and India go back to the third millennium BC. Spice trade used to be the main trade at the time. India gained independence from Great Britain in 1947. Soon after, these two countries formed official relations. They are actively working together in regional affairs and trade. Saudi Arabia is one of the biggest oil suppliers to India. On the other hand, India is one of the top investors in Saudi Arabia. There is also a strong connection through religion. That is because Islam is the second major religion in India.

Trade agreements development between Saudi Arabia and India

India is an emerging economy. It has increased a lot its economic ties with Saudi Arabia in the last few decades. India has seen Saudi Arabia as an important power and trading base in the region. A couple of millions of Indian nationals work in Saudi Arabia. Since the 1990s, both countries have taken active steps to improve their ties.

Agreement on a strategic energy partnership was one of the first agreements that they signed. This agreement provided an increased import of crude oil to India. Both nations agreed on strategic partnerships.

The development of the oil and natural gas trade is one of the main goals. Saudi King Abdullah and the Indian Prime Minister signed Delhi Declaration in 2006. Consequently, that agreement started a new era of cooperation between the two countries in all important fields. Then in 2010 Strategic Partnership and the Riyadh Declaration were signed related to cooperation in economics, security, and defense. After that, the officials also signed other important trade agreements regarding the establishment of a joint business council. Additionally, they agreed on the protection of investments and on avoidance of double taxation, and prevention of tax evasion.


India is the world’s largest exporter of spices

Trade regulations and agreements between Saudi Arabia and India

Saudi Arabia supplies to India nearly 175 million barrels of oil a year. Additionally, India imports organic and inorganic chemicals, gold, and leather from Saudi Arabia. Saudi Arabia is one of India’s main trading partners. India needs to import goods and services in certain areas. For example energy and basic structure (railways, roads, ports, airports, water supply). For any type of goods, professional staff at are experts in all kinds of relocations, transportation, customs clearance, warehouses, etc.

India’s most important exports to Saudi Arabia include textiles, machinery, cereals, rice, meat, spices, fruits, etc. Both countries are signing trade agreements in order to expand cooperation.  Also, India agreed to provide higher education for Saudi Arabian students in India. In addition, cooperation between science institutions is expanding.

Sea Freight between Saudi Arabia and India

Sea freight is the most common form of transport for importers and exporters. Most of the goods in the world are transported by sea. That also goes for trade between Saudi Arabia and India. However, good knowledge of shipping is necessary. So, here are some of sea freight advantages:

  • Cost-Effectiveness – transport of containers which contain goods by ship is one of the most cost-effective ways of transport.
  • Heavy items – sea shipping may be the only way to transport the goods overseas when items are large or heavy. In addition, most of the shipping ports have large warehouses for their storage.
  • Good for Environment – sea freight is the most eco-friendly way of transport for cargo.

So when it comes to shipments from Saudi Arabia to India, reliable professionals will transport goods with no hassle. Experts who have years of experience will know how to handle sea cargo. Therefore, expertise in freight, customs clearance, packing, and storage is necessary when it comes to overseas transport.

Trade regulations in Saudi Arabia

Saudi Arabia applies certain trade regulations. Here are some of them:

  • The validity period for food and the ingredients should be written in Arabic.
  • Medical products must be registered.  
  • Oil, natural gas, and wheat require export licenses. There may be a prohibition on the exportation of some products. Certain products may need special approval from the Saudi authorities for exportation. For example antiques, livestock, Arabian horses, etc.
  • Saudi law prohibits importation of the some products. For instance: alcohol, weapons, narcotics, pork and pork products, used cars, etc. In some cases, they may need special approval. For example farming seeds, books, harmful materials, etc.

Indian Community in Saudi Arabia

The Indian community is the largest ex-pat community in Saudi Arabia. In addition, they are highly valued due to their knowledge, discipline, and peaceful nature. Indian community’s contribution to the development of Saudi Arabia is greatly recognized.

Investments between Saudi Arabia and India

Saudi Arabia and India are both fast-developing countries. Investments are made into computer technology, machines, cement, paper manufacture, chemicals, etc. New Saudi laws permit founding strategic partnership projects. Consequently, more Indian companies are ready to invest. These investments are for projects in different sectors. In addition, several Indian companies have established new ties with Saudi companies. And now, they are working together in the areas of consulting and financial services, design, and software.

Future investments

In 2020, Saudi Prince Mohammed bin Salman visited India. On that occasion, he announced that his country expected investments in India of about 100 billion dollars. In 2019, the high officials concluded additional trade agreements. They referred to air crafts, energy, oil, gas, etc.

Meanwhile, diplomatic relations are going stronger. Cultural and economic ties between the two nations are constantly growing.