$100bn annual trade underpins muted Arab response to India’s actions in Kashmir

DUBAI: Gulf Arab countries have remained mostly silent as India’s government moved to strip the Indian-occupied sector of Kashmir of its limited autonomy, imposing a sweeping military curfew in the disputed Muslim-majority region and cutting off residents from all communication and the internet.

This muted response is underpinned by more than $100 billion in annual trade with India that makes it one of the Arabian Peninsula’s most prized economic partners.

Regional heavyweight Saudi Arabia urged restraint and expressed concern over the brewing crisis. Other Gulf countries — Kuwait, Qatar, Bahrain and Oman — do not appear to have issued any statements. The United Arab Emirates has gone a step further by apparently siding with India, calling the decision to downgrade occupied Kashmir’s status an internal matter.

Saudi Arabia’s response to the Kashmir situation is complicated by its close ties with both India and Pakistan, which have fought two wars over the disputed Himalayan region, as well as its ideological rivalry with Turkey and Iran for supremacy in the Islamic world.

Prime Minister Imran Khan has reached out to leaders in Saudi Arabia and Bahrain in recent days to discuss India’s actions in Kashmir, but it’s unclear whether he would find Arab backing if he took his concerns to the United Nations Security Council.

The brief Saudi statement on the Kashmir events said the kingdom “is following up on the current situation” and called for a “peaceful settlement” in line with international resolutions.

Gulf Arab states are home to more than 7 million Indian expatriates who help drive the region’s economy and keep its cities teeming with doctors, engineers, teachers, drivers, construction workers and other laborers.

Nowhere in the region is this relationship more pronounced than in the UAE, where Indians outnumber Emiratis three to one. Bilateral trade surpassed $50 billion in 2018, making India the UAE’s second-largest trade partner.

Indian investments in the UAE amount to $55 billion and Indians are the largest foreign investors in Dubai’s real estate market, according to India’s Ministry of External Affairs. Meanwhile, DP World, Dubai’s global port operator, has plans to develop a logistics hub in Indian-controlled Kashmir.

The UAE doubled down on this strategic relationship when it signaled support for Indian Prime Minister Narendra Modi’s government as New Delhi rushed to send tens of thousands of additional soldiers to occupied Kashmir, already one of the world’s most militarised regions. The troops were deployed to prevent unrest and protests over the August 5 decision to strip the territory of its special constitutional status.

The UAE’s ambassador to India, Ahmed al-Banna, was quoted in local media in both countries as saying the changes in Kashmir “would improve social justice and security […] and further stability and peace.”

The decision by Modi’s Hindu nationalist government carries religious overtones for Muslim residents of the Indian-occupied Kashmir.

The revocation of the region’s constitutional status, which needs the approval of the ruling party-controlled parliament, means Kashmiris lose their hereditary right to jobs, scholarships and land ownership. Government critics see the move, which would allow Indians from outside the region to permanently settle and buy land, as an attempt to alter Kashmir’s culture and demographics with Hindu settlers.

These religious tensions have made Kashmir another field of contest between Saudi Arabia, Iran and Turkey to champion Muslim causes worldwide, said Hasan al-Hasan, an expert on Gulf-Indian relations at the International Institute for Strategic Studies.
“The Turks are trying to cultivate influence in Kashmir. The Iranians are trying to cultivate influence in Kashmir. So I doubt that Saudi Arabia would want to concede a lot of ground to the Turks and the Iranians in terms of this broader symbolic contest over the leadership of the Muslim world,” he said.

Turkey, which has less than $7 billion in annual bilateral trade with India, has thrown its weight behind Pakistan. A readout from a recent call between the President Recep Tayyip Erdogan and Pakistan’s prime minister emphasised Kashmiri self-determination.

Iran permitted a symbolic protest of around 60 students outside the Indian Embassy in Tehran last week, and a senior cleric there told worshippers during Friday prayers that India’s actions in Kashmir were “an ugly move”. However, both President Hassan Rouhani and the foreign ministry have issued more tempered statements, calling for dialogue and peace between Pakistan and India. The varied response comes as bilateral trade plummets following India’s decision to stop buying Iranian oil due to US sanctions on Iran.

In contrast, Saudi Arabia is home to 2.7 million Indians and is India’s second biggest supplier of oil after Iraq, according to Indian government statistics. Saudi oil exports to India dominated $27.5 billion in bilateral trade last year.

On Monday, the eighth day of the military curfew in Kashmir, India announced one of the biggest ever foreign investments in the country — a $15 billion purchase by Saudi Arabia’s state-owned Aramco in India’s Reliance oil and chemicals business. Beyond that, Saudi Crown Prince Mohammed bin Salman has vowed $100 billion of Saudi investments in India by 2021.

Gulf Arab countries may also be wary of supporting Kashmiri rights because it centers on “people’s right to their own freedoms”, said Hafsa Kanjwal, a Kashmiri American assistant professor of South Asian history at Lafayette College.

Bahrain, rocked in recent years by Arab Spring protests, reported that a number of people were arrested after South Asian residents held a protest there in support of Kashmir and against India after Sunday’s Muslim prayers for the Eidul Azha holiday.

“Kashmir is linked to movements for self-determination and people’s rights and democracy, which these Gulf countries, and Israel, are very much against and very much wary of,” Kanjwal said.