Saudi diversification efforts look to China and India

Subject

Saudi non-oil ties with China and India.

Significance

Prior to the announcement in April of its economic reform programme 'Vision 2030', Saudi Arabia hosted Chinese President Xi Jinping and Indian Prime Minister Narendra Modi. These visits created a new momentum in Saudi Arabia's 'look east' policy, which it has been pursuing over the past ten years since late King Abdallah's visits to Beijing and Delhi in 2006.

Impacts

• Low human capital development in Saudi Arabia will be the greatest barrier to Chinese and Indian investment.
• Chinese and Indian investment is focused on relatively low-tech sectors, so is unlikely to compete with Western and Japanese firms.
• China and India's success in attracting Saudi business partners will depend on how fast they can improve their own technology.