Foreign direct investment (FDI) from the GCC to India has picked up pace in recent years but remains negligible relative to trade flows in terms of magnitude, said a top official.

"With the economic forecasts pointing to strong GDP growth in both the economies, we emphasise that there is an ample scope of strengthening economic ties between GCC and India," said Sameena Ahmad, managing director of Alpen Capital, in a research paper - Trade and Capital Inflows between GCC and India.

"While the GCC needs to promote re-industrialisation and small and medium enterprises' participation in order to realise its diversification dream and create jobs for its rapidly expanding population, India needs to further improve its basic infrastructure and reduce complexity in the regulatory practices.

"We recommend GCC investors to further diversify their investment portfolio by taking positions in the promising Indian investment avenues as the return on investment remain relatively robust.

At the same time, due to its locational advantage and abundance of natural resources, GCC has the potential to serve as a manufacturing base as well as an export hub for Indian companies," she added. – TradeArabia News Service