Balancing act: Modi to visit West Asia in Feb with eye on $75-bn investment

Modi will want to take up $75 bn worth of investments in India's infrastructure sector that Emirates had promised India from its sovereign fund

Israeli Prime Minister Benjamin Netanyahu departs from India after a six-day visit on Friday, and in a West Asian geopolitical balancing act, Prime Minister Narendra Modi is scheduled to be in Ramallah, the de facto capital of the State of Palestine, on February 10.

PM Modi's visit to West Asian countries in February will have an eye on investments. Apart from Palestine, Modi is scheduled to visit the United Arab Emirates (UAE) on February 10 and 11. He will also visit Oman and address the sixth World Government Summit in Dubai. 

The visit to Palestine is important in terms of West Asian geopolitics, and New Delhi’s need to counterbalance PM Modi's visit to Israel, the first ever by an Indian PM, in July 2017, and the return visit by Israeli PM Netanyahu to India, which is the first by an Israeli PM since that of Ariel Sharon in 2003.

While New Delhi and Tel Aviv draw into an ever closer defence and security cooperation, India cannot ignore other West Asian countries and not just for reasons of domestic politics.

Around seven to eight million Indians live and work in West Asian countries. According to the World Bank's report, India retained its top spot as the world's largest recipient of remittances in 2016, with inflows amounting to $62.7 billion, which translated to a decrease of 8.9 per cent from $68.9 billion in 2015. Further, India is expected to retain its top spot in this regard in 2017 as well, with remittances expected to total $65 billion, according to the World Bank. Most of these remittances come from Indian workers in West Asia. The region is also the main source of India’s energy security and home to major Indian exports.  

During his visit to the UAE, Modi will also want to take up the $75 billion worth of investments in India's infrastructure sector that the Emirates had promised India from its sovereign fund during Modi's visit there in 2015. There has been little progress in terms of any investments from that fund and UAE's officials have blamed New Delhi for its failure to put in place the necessary set up to operationalise the fund. With job growth being a concern, the Modi government wants the funds to start flowing in. Indian officials say the requisite processes have been completed. 

The PM is scheduled to visit Abu Dhabi and Dubai. According to a report in the Khaleej Times on Wednesday, Modi will be in Abu Dhabi on February 10. The India-UAE trade stands at $53 billion. The UAE is India’s third-largest trading partner, while India is the largest trading partner of the UAE. In 2016-17, the UAE was the fifth-largest supplier of crude oil to India. It has a 2.6 million-strong Indian diaspora working there. Modi had last visited UAE in August 2015. It was the first visit by an Indian PM to UAE after Indira Gandhi’s in 1981.