Why the Saudi-UAE rift matters to India

THERE is a churn in the Gulf. This does not mean that India's recent foreign policy upsets in the neighbourhood and North America will be repeated in the region to the west of Pakistan up to the Red Sea. This region not only comprises the existential foundations of India's security and sustenance, but it is also an extension of its demography.

The transition of Saudi Arabia and the United Arab Emirates from blood brothers to competitors, however, calls for caution in New Delhi. The mindlessness visited upon India-Canada relations or the complete lack of artifice in India-United States engagement since Donald Trump became the US presidential candidate in 2024 must not be repeated in the Gulf Cooperation Council (GCC) states.

The expansion in relations with the UAE and Saudi Arabia, in that order, has been a stunning success story for India's diplomacy over the last 10 years. But as Bangladesh demonstrated last year, foreign policy is never static. Complacency in dealing with rapidly changing circumstances in the Gulf can cost India dearly. Caught up in trade tariffs and concerns about protection of minorities abroad, there has been very little public awareness or discourse on the recent ominous changes in the Gulf.

Pakistan was once the pre-eminent South Asian influencer in the Gulf, long before that term became associated with social media in the 21st century. Well before he became Pakistan's President, Zia-ul-Haq became a hero to Gulf monarchies. Zia found his way into the hearts of these sheikhs for his role in personally putting down the Black September revolt by Palestinians and saving the Jordanian monarchy.

At that time, Zia was posted in Amman as the head of a Pakistani military training mission to Jordan. Pakistan's army was formally drafted to protect the House of Saud and it played an informal, but important, role in dealing with frequent, multiple threats to other sheikhdoms.

India in those years was little more than a source of apolitical and dependable labour — in large numbers — as fodder for huge, petrodollar-funded construction projects, from housing to refineries, which were coming up in these newly-rich nations.

Before Prime Minister Narendra Modi successfully changed India's profile in the UAE, Indira Gandhi attempted to compete with Pakistan. She was not successful because conditions in India were then not compatible with those in the Gulf for any engagement other than seeking work for India's ayahs, bearers, cooks and drivers — ABCD, as they were called locally.

The sea change in New Delhi's role — mainly because India is now an emerging economy and not a mid-level developing country — has also raised India's stakes in the region.

Important developments like the rift between Saudi Arabia and the UAE, the earlier boycott of Qatar by its neighbours or the colour revolution-like uprising in Bahrain now have consequences for India's economy, labour mobility and national security.

The long regional boycott of Qatar ended in a shaky compromise and the uprisings in Bahrain continue to occur from time to time. It is the Saudi-UAE rift that is ongoing — and worsening by the day. It is also the most consequential for Indian interests there.

The UAE has an Indian expatriate population of 4.5 million, second only to the number of ethnic Indians in the US. Saudi Arabia ranks third in the world, with about 2.8 million Indians.

Together, the UAE and Saudi Arabia account for the biggest inflow of remittances into India. The GCC is the biggest component of India's foreign exchange reserves. India's strategic petroleum reserve is almost entirely made up of crude from Abu Dhabi.

Fifty-five per cent of all Indians travelling abroad pass through the UAE or make it their final destination. The UAE is also India's third largest trading partner. Unacknowledged officially, it is the vital springboard for value-added Indian exports to the US, substantially circumventing the Trump administration's punitive tariffs on Indian goods. None of this is under threat unless the Saudi-UAE spat deteriorates. But it cannot be taken for granted that issues affecting their ties will not spiral out of control, as things often do in volatile West Asia.

The immediate trigger for a pronounced downturn in Saudi-UAE relations is their differing approach to Yemen, where both countries fought together from March 2015 to restore the globally recognised government in Sanaa, which was overthrown by Houthis with Iran's support. Four years later, as the UAE's fatalities rose, it began to scale down its boots on the ground.

Saudis, on the other hand, did not lose as many people because they confined the attacks on Houthis to aerial bombardment. As a measure of compassion, the Khalifa Foundation Charity — named after a former UAE president — even sent planeloads of wounded Yemenis for medical treatment in Indian hospitals.

As the Saudi-led "Coalition of the Willing" unravelled, the UAE decided to make a separatist group — the Southern Transitional Council (STC) — its proxy in Aden. Saudi Arabia wants a unified Yemen under its legal government based in the national capital. Last week, the UAE-backed STC was practically controlling all the territory of what used to be South Yemen. This territory's main airport in Aden was closed following attacks launched from Sanaa with Saudi support.

Saudi Arabia and the UAE are also at loggerheads over Sudan, where the Kingdom supports General Abdel Fattah Al Burhan, Commander of the Sudanese armed forces. The UAE arms and funds a rival army, the Rapid Support Forces, led by General Mohamed Hamdan Dagalo. For India, the conflict in Sudan is not some faraway war on television screens. It can quickly come home. There are 2,396 Indian troops in the United Nations Mission in the Republic of South Sudan (UNMISS). The UN Interim Security Force for Abyei (UNISFA), an area disputed between Sudan and South Sudan, has another 596 Indian peacekeepers.

They will be at risk if Saudi Arabia and the UAE escalate their arms supplies and funding to their respective proxies. The ONGC Videsh Limited invested $2.3 billion in undivided Sudan's oil industry as part of its energy security strategy. This investment is now spread over the two Sudans and has been affected by the civil war.

All in all, Indian diplomacy has to go beyond the cliché of "closely watching" the situation.