India has a lot at stake in Saudi-Qatar row

As corporate investments remain abysmally low, India-Qatar trade is fueled by a single commodity

As the multi-nation boycott of Qatar comes into force, there are some companies based in India that have invested money in the country over the last two years. German software maker Itelligence's domestic arm Itelligence India and Interglobe Aviation are among the firms that have been investing in the country. 

Interglobe Aviation that runs Indigo Airlines, invested close to $400,000 in its subsidiary Interglobe Air Transport Ltd in March, 2017. This was almost a month before Indigo Airlines launched its first flight to Doha. Speaking on the impact of Qatar crisis on Indigo’s investments and operations, the airline’s spokesperson said, "We are closely monitoring the situation. There are no changes in the current flight schedule.”

Itelligence is reportedly working on providing software solutions to companies for gearing them up for the implementation of the goods and services Tax (GST) from July 1. It also claims to have worked on the Malaysian GST conversion and Euro VAT conversion projects in the past. It has been one of the most regular investors from India to Qatar over the last year. Reserve Bank of India (RBI) data shows that during 2016-17, Itelligence India invested more than $800 million in Qatar in a joint venture called Itelligence Software Solutions WLL.

During 2015-16, one of the largest investments made by an Indian company in Qatar was by Va Tech Wabag, a Chennai-based water solutions company. It had invested $1.5 million in a joint venture in Qatar. Other smaller investors include Mainland China Restaurants and the Gammon group.

India and Qatar’s corporate investments in each other’s nations have been rather abysmal over the years. According to India’s Ministry of Finance latest figures, over the last 17 years, foreign direct investment (FDI) equity inflows from Qatar amount to almost $24 million, representing 0.1% of all such flows into India. Back in 2016, Press Trust of India quoted Qatar Financial Centre’s chief strategy officer and business development officer Kamal Nagi as saying that Indian companies had invested $450 million in Qatar over the last seven years.

The isolation of Qatar comes at a time when the West Asian sultanate was showing prominent signs of investing in India through its sovereign wealth fund Qatar Investment Authority (QIA). Qatar Airways CEO Akbar Al Baker had, earlier this year, confirmed that the airline would be starting domestic operations in India after the government completely opened Indian aviation to foreign airlines. The QIA has been reportedly looking to invest $250 million in real estate, apart from partnering with Qatar Airways in the domestic airline.