India May Keep Gold Out of GCC Free Trade Deal

India is unlikely to extend tariff concessions on gold in its proposed free trade agreement with the GCC, according to news reports. The stance indicates a measured approach as India navigates trade liberalisation in sensitive sectors.

The discussions come weeks after India signed a trade pact with Oman, where gold and silver bullion were explicitly excluded from tariff benefits. The position reflects domestic concerns linked to import surges observed under previous agreements.

Cautious Approach Rooted in CEPA Experience with Oman

India’s recent Comprehensive Economic Partnership Agreement with Oman, signed on December 18, 2025, in Muscat, adopted a conservative framework for precious metals. The pact excluded gold and silver bullion from tariff concessions to prevent disruptions in the domestic market.

Trade officials highlighted that sensitive items required careful handling due to their impact on local industries. The move also set a precedent for upcoming negotiations with the GCC bloc.

Revival Of Trade Negotiations with GCC After Two Decades

India and the six-member GCC, comprising the United Arab Emirates, Saudi Arabia, Qatar, Kuwait, Oman, and Bahrain, formally revived FTA negotiations earlier this month. Both sides signed the terms of reference to restart discussions that had remained inactive for almost 20 years.

The renewed engagement aims to expand bilateral trade across sectors while addressing modern trade requirements. The GCC is a key trading partner for India, particularly for energy and commodity imports.

Scope Of Negotiations Under the Terms of Reference

The signed terms of reference outline a wide negotiating agenda between India and the GCC. The discussions will cover trade in goods and services, investment frameworks, customs procedures, and technical barriers to trade.

They will also include dispute settlement mechanisms intended to streamline cross-border commercial activity. The broad scope indicates the intention to build a comprehensive trade framework beyond tariff preferences alone.

Impact Of Precious Metal Concessions in Earlier Agreements

Experience from India’s trade agreement with the UAE has contributed to the cautious position on gold. Under that agreement, tariff concessions on precious metals led to a substantial rise in imports into the Indian market.

The surge sparked concerns over domestic market stability and the potential for increased smuggling or arbitrage activity. These outcomes have influenced India’s stance as it negotiates with the larger GCC grouping.

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Conclusion

India’s decision to avoid offering tariff concessions on gold in its upcoming FTA with the GCC reflects lessons from earlier trade pacts. The approach also aligns with the need to protect domestic markets while pursuing broader economic integration.

With negotiations covering a wide range of sectors, both sides are preparing for a comprehensive trade framework. Further updates will depend on subsequent negotiation rounds following the agreed terms of reference.

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