India has ties with West Asia since pre-historic times. West Asia lies in the second concentric circle of India’s strategic matrix, a natural ally in the Kautilyan dictionary. For decades, the relationship between India and the Gulf has been defined by oil. However, India’s interests in the Gulf are beyond oil and gas imports. While West Asia has spending capacity, India has unmatched potential and investment capacity.
History of relations
In ancient times, lands that now constitute Iraq were known as Mesopotamia – ‘the land between the rivers’. And Indus valley civilization had thriving trade relations with it. Iraqi port of Basra was used as a hub for Indian merchandise export and pearl trade.
In medieval times, the relations were defined by the ties of rulers who came from the region. With Indian borders extending up to Kabul at times, Iraq was just the next-door neighbour for India.
Post decolonization, Iraq has consistently been among the top suppliers of crude oil to India for the last several years. During the height of US sanctions against Iran – one of India’s critical oil suppliers, Iraq regularly rotated as the top two largest suppliers to New Delhi, often even trumping Saudi Arabia.
Iraq used to be the main destination of huge projects for Indian companies. According to C Raja Mohan, the India-Iraq partnership was not limited to energy security. Indian public sector companies participated in a big way in Iraq’s national construction in the oil boom of the 1970s.
Factors inducing stress
The 1952 Treaty of Friendship between India and Iraq established and strengthened ties. By the 1970s Iraq was considered as one of India’s closest allies in the Middle East. Though Iraq has been a politically supportive friend and the top oil supplier at times, the bilateral relations started losing momentum 1990s onwards. Iraq’s occupation of Kuwait, the 1991 Gulf War, and the enforcement of the sanctions-inspections regime being the prominent reasons. War in Iraq also harmed the welfare of Indian workers in the Gulf, contributed to the rise in prices of petrol, and led to the disruption of India’s international commerce.
Before the Iran-Iraq war (1980-88) and the Gulf War (1991), Iraq had been one of India’s largest exports market. However, UN sanctions and resultant Iraqi isolation diminished India’s commercial and diplomatic ties. This has been exacerbated (made worse) after the invasion of Iraq (2003). Most distressing for New Delhi has been the rise of domestic terror attacks. With the kidnapping of 40 Indians by ISIS in Mosul (2014), India became conscious of Iraq’s internal issue between Sunnis and Shias.
The remarkable success of militant ISIS is a clear risk to India’s energy security. It can stop some of India’s supplies from West Asia. The growing turmoil in the region has necessitated that India urgently explores more reliable and proximate sources of energy. Increasing terrorism in Iraq is a pertinent challenge for India because of the presence of the Indian diaspora in the region. At a time, relations had deteriorated to an extent that there was no Indian ambassador in Baghdad from 2005-2011.
India at the UN had expressed serious concerns about the terrorist attacks that took place in Baghdad. India said that these terror attacks are a “stark reminder” that the Islamic State of Iraq and the Levant (ISIL) continues to pose a significant challenge to the peace and stability in the region. India reminded UNSC that it must focus on eliminating every threat posed by ISIL and other terror groups elsewhere in the world. Iraq should not become a theatre for regional or global conflict.
Further, the economic presence of Russia, Japan, the UK, France, and new players like China and Iran is growing and is also of major concern to India.
Since the outbreak of war in Iraq, India has been supporting a free, democratic, pluralistic, federal, and unified Iraq. India has responded to the urgent needs of Iraq for relief and economic reconstruction, directly and also as part of international efforts under the UN auspices. In 2003, India committed $20 million for assistance to the Iraqi people.
In the post-war scenario, India is trying to rebuild its interrupted ties with Iraq. In 2012, Iraq emerged as India’s second-largest crude oil supplier, thereby shifting focus back on bilateral relations. Total bilateral trade has grown steadily after 2010 due to increasing crude oil imports. India also has stakes in the oil block in Iraq.
India’s economic engagement with Iraq has increased to bilateral trade of $26 billion in 2019-20, about 3.25% of our total foreign trade. The people to people and institutional contacts has resulted in India becoming one of the most preferred destination for Iraqi’s seeking quality medical help. Even Iraqi pharmaceutical companies have been actively participating in various events organized in India.
India and Iraq share common regional concerns on the situations in Syria, Iran, Egypt, and Turkey, as well as on Palestine. During the pandemic, under the ‘Air Bubble Arrangement’ between the countries, over 10,000 Iraqi nationals have travelled to India for medical treatment.
India is increasing its political engagement with Iraq. With upcoming elections in the country, India has agreed to support Baghdad’s request for UN observation. India has further stated that it will support any process which respects Iraq’s sovereignty and strengthens the democratic exercise, making it credible and acceptable to the people of Iraq.
Future of India-Iraq relationship
India’s strong historical and cultural connections with Iraq, along with its growing economic clout, can be the backdrop to jump-start its economic resurgence in Iraq. India should work towards developing a trade agreement with the country to further boost the trade.
The stability of Iraq is not just a regional interest for West Asia but global political architecture as well. India has been annually assisting Iraq under the Indian Technical and Economic Cooperation (ITEC) to train Iraq’s government officials. With new avenues opening up, India should also try to increase the virtual platforms to increase its reach.
Concerning terrorism in Iraq, India should continue to assist Iraqi officials to combat terrorism. India should consider cooperating with other states to undertake capacity building of the Iraqi security forces so that they can fight against terrorists effectively. A terror-free and prosperous Iraq will benefit not only Iraq-India but the whole world.