India Saudi Arabia Bilateral Trade Relations

Purpose: In recent years India-Saudi Arabia bilateral trade has grown enormously. In 2013, Saudi Arabia ranked four amongst the leading trading partner of India and on the flip side; India was the seventh largest trading partner of Saudi Arabia. This paper explores the major trends of bilateral trade between the two nations and tries to scrutinize the features and challenges that arose out of this trade intensity and resulted in a mutual benefit of both state during the period of 2001 to 2013. Methodology: To achieve these objectives, trade intensity index and revealed comparative advantage at aggregate and disaggregate level has been calculated. The result analysis highlights that the structures of export in India and Saudi Arabia differs significantly. Findings: This indicates a positive point that both the nations are not in a competition as the various areas of merchandise trade is different in India and Saudi Arabia. So, this specialization, in bilateral trade liberalization, undoubtedly acts as a precursor towards an enhanced potential of economic growth for both countries. Recommendations: Conclusively, the analysis highlights that there has been acceleration in the bilateral trade and this infers that one can expect a positive effect on economic trade relations between the participating nations.