Indo-Saudi Economic Relations

 

 

Saudi Economy – An overview

 

Indo-Saudi Joint Ventures

 

Top 100 companies in Saudi Arabia

 

Saudi Arabian General Investment Authority (SAGIA)

 

Negative List

 

Methodology of Business Operations

 

Business Regulations & Procedures

 

Resolution of Trade Disputes

  Areas of Investment and Exports

 

SAUDI ARABIA – AT A GLANCE

Geography: 

Location   

Middle East, bordering the Persian Gulf and the Red Sea  north  of Yemen

Area 2.25 million sq. kms
Border countries

Iraq 814 km, Jordan 728 km, Kuwait 222 km, Oman 676 km,

Qatar 60 km, UAE 457 km, 1,458 km

Coastline  2,640 kms
Climate harsh, dry desert with great extremes of temperature
Terrain mostly uninhabited, sandy desert
Natural resources

petroleum, natural gas, iron ore, gold, copper

                                                  

 People

Population    (2003 est.) 

24.06 Million (Growth rate 2.9%)

Males – 13.21 million; Females – 10.85 million

Saudi - 17.93 million (growth rate 3.3%)

Non-Saudi –    6.14 million (growth rate 1.7%)  

Fertility rate: 6.2 children born/women (2003)

Age structure

0-14 Years: 39.71%

(male 4,878,200; female 4,678,000)

15-64 Years: 57.89%

(male 8,065,800; female 5,863,200)

65 years and above: 2.4%

(male 270,800; female 308,000)

Average wage of workers  SR 2461 per month (2001)
Average Wages by nationality

Saudi                       SR 6560 (2001)

Non-Saudi                SR 1722 (2001)

Government

Capital   Riyadh
Administrative divisions

13 provinces Al Baha, Al Hofuf, Al

Jawf, Al Madinah, Al Qasim, Ar Riyad

Ash Sharqiyah, Asir, Hail, Jizan,

Makkah, Najran, Tabuk

Independence (National Holiday) 23 September, 1932
Constitution

Governed according to Sharia

(Islamic Law).

Legal System

based on Islamic Law, several secular

codes have been introduces; commercial

disputes handled by special committees;

Has not accepted compulsory ICJ Jurisdiction

Executive branch

Head of State & Head of Government:

King and Prime Minister, & Custodian of the two Holy Mosques Fahd bin Abd al-Aziz al Saud (since 13 June 1982);

 

Crown Prince and

First Deputy Prime Minister

Abdallah bin Abd al-Aziz Al Saud

Legislative branch

Legislation through royal decrees.

Consultative Council of 120 members

and a Chairman appointed by the Monarch for

Four-year terms.

Judicial branch Supreme Council of Justice

Economy  

The Saudi economy    rests primarily on oil revenues.    Its crude oil reserves,   amounting to  259.40 billion  barrels, are estimated to be  25% of the world’s  known reserves. Its natural  gas reserves  at  200  trillion  cubic  feet  are  4%  of   world  reserves.  The average daily  output of oil during the year 2002 was around 7.09 mbd.   The petroleum  sector accounts  for  78 % of  total  revenues,  37.5 %  of  the  Gross  Domestic Product and 88% of export earnings.  About 41 % of the GDP is generated by the private sector.     The Kingdom, under its "Saudization policy", has undertaken to reduce its dependence on foreign labour in key sectors by progressively replacing expatriate workers (around 3.6 million) by Saudis. During the last few years, the Kingdom has been introducing changes in its trade, investment and taxation regulations to make itself an attractive investment destination as also to pave the way for its accession to the WTO. The Saudi Arabian General Investment Authority (SAGIA), set up in May 2001 provides “fast-track” approvals for investment in different sectors, including setting up of 100 % foreign owned entities.

 

Economic indicators:

Per capita income $ 7,970
GDP $211.2 billion
GDP real growth rate 6.4 %
GDP private sector real growth rate 3.4%
Oil Reserves 259.40 billion barrels
Natural Gas Reserves  6531 billion Cubic Meters
Production of Crude Oil 2589 million barrels (average 7.09 million barrels per day)
Production of petrochemicals 29.6 million tons
Oil refining 1.6 million barrels per day
Number of producing factories 11622
Industrial investment $ 46 billion
Electricity generation capacity 24,768 Megawatts
Electricity Consumption 128.63 Megawatts/hour
Voltage 110v/60Hz & 220/50Hz
Water supply from Desalination plants 1,021.5 Million Cubic Meters
Agricultural / poultry products wheat, barley, tomatoes, melons, dates, citrus, mutton, chicken, eggs, milk
Total Exports $71.57 billion
Total Exports of oil and oil products $62.93 billion (87.9%)
Export - partners Japan. US. South Korea, India and Singapore
Imports   $32.27 billion
Imported commodities Machinery & equipment, Foodstuff, Chemicals and metals, Textiles and clothing, Motor vehicles, Jewellery and ornaments
Imports – partners US, Japan, Germany, UK, Italy, France, China, Australia, South Korea and India
   

 Industries:

                 Main industries are in the field of crude oil production, petroleum refining, basic petrochemicals, cement, construction, fertilizer, plastics etc.

Budget 2004

Total budget SR 430 billion ($114.66 billion)
Project Revenues SR 200 billion ($53.33 billion)
Projected expenditures SR 230 billion ($61.33 billion)
Deficit SR 30 billion ($8 billion)

Sectoral allocations

Education  SR 63.7 billion ($16.98 billion) (28%)
Health SR 24.3 billion ($6.48 billion) (11%)
Municipality projects SR   8.6 billion ($2.29 billion) (4%)
Transport & Communication SR   7.3 billion($1.95 billion) (3%)
Infrastructure including Water, Industry & Agriculture SR 15.1 billion ($4.02 billion) (7%)
Other sectors SR 111 billion  (47%)

Growth of private sector GDP                                      :                3.7%

Growth of non-oil sector                                               :              3.9%

Growth in Construction sector                                       :              2.8%

Electricity, gas and water                                :               6.2%

Transport and communication                           :              4.3%

Wholesale, retail, restaurants and hotels  :                       4.4%

 

New sectors opened for privatization            :         Water and water treatment, airports, roads,

                                                                             railroads, education, health & social services.

Currency                                                     :          Saudi Riyal (SR)

Exchange Rate                                           :           $1 = SR 3.7450 (fixed  rate since 6/86)

Fiscal year                                                 :            Calendar year

Communications

Telephone lines - fixed                                 :               3.3 million (2002)

Telephone – mobile cellular                          :               5.0 million (2002)

Internet country code                                     :               Sa

Internet service providers (ISPs)                     :               21 (2003)

 Internet users                                                :               1.6 million (2002)

 Telephone Codes                                         :               01 Riyadh;

                                                                                     02 Jeddah, Makkah, Taif

                                                                                     03 Dammam, Dhahran,

                                                                                     Jubail, Hofuf

                                                                                     04 Yanbu, Tabuk, Madinah

                                                                                     05 Cellular

                                                                                     06 Hail, Al Qaseem, Al Majmaa’h

                                                                                     07 Abha, Najran

 Transportation                        

Ports and harbors                              Ad Dammam, Al Jubail, Duba, Jeddah, Jizan, Rabigh, Ra's al Khafji, Mishab, Ras Tanura, Yanbu' al Bahr, Madinat Yanbu' as-Sinaiyah.

 Railways                                                                   :                1392 kms (2001)

 Highways                                                                 :                151,800 kms

 Length of asphalted roads                                         :               45,572.3 kms (2002)

 Length of earth surfaced roads                                  :                114,505.3 kms (2002)  

 No of registered vehicles                                          :               9.1 million

 Major ports                                                                :      Jeddah, Dammam, Jubail, & Yanbu  

 

 

 Volume of imports and exports handled at the ports     :                104.2 million metric tons

 Airports                                                    :               27, of which three

                                                                                are international Airports: Jeddah, Riyadh

                                                                                and Dhahran

Others:

 Health facilities                                  :                Health centers            :     1,786 (2002)

                                                                            Hospitals                   :        324 (2002)

                                                                           Beds                         :   46,600 (2002)

                                                                           Physicians                  :   32,000 (2002)

                                                                           Private dispensaries    :        744 (2002)

 

Number of hotels                                   :                861 (2002)

Number of rooms                                    :                142,000 (2002) 

Number of cement companies                                      :               8

Cement production                                                      :                23.3 million tons (2002)

Cement consumption                                                   :                20.5 million tons (2002)

Cement exports                                                          :                 2.9 million tons (2002)

Industrial Cities                                                 :                Riyadh, Jeddah, Dammam,

                                                                                         Aseer, Makkah, Al-Qassim, Al-Ahsa,

                                                                                         Al-Jouf, Najran Jubail and Yanbu.

General

Largest cities (2003):                        :                Riyadh, 3,724,100;

                                                           Jeddah, 2,745,000;

                                                           Makkah, 1,614,800

 

Ethnicity/race                                 :                Arab 90%; Afro-Asian 10%

Religion                                        :                Islam (100%)

Literacy rate                                  :                78% (2002 est.)

Language                                     :                Arabic (English is widely used in

                                                                    Business circles)

Time Zone                                   :                GMT +3 hrs

 Business Hours: The working week is Saturday to Wednesday, although some offices and businesses also operate on Thursday morning. 

 Weekly Holiday : Friday

 Government Offices: open from 7.30 am to 2.30 p.m.

Banks: open 8.00 a.m. to 12 noon and 5.00 p.m. to 8.00 p.m.

Private Businesses: open 8.00 a.m. to 12 noon and 5.00 p.m. to 10.30 p.m.

 Official Holidays

Eid Al-Fitr, "the festival of breaking the fast", runs from the 25th day of the month of Ramadan to the 5th day of the following month. Eid Al-Fitr is an occasion of great celebration and rejoicing.

Eid Al-Adha, "the festival of sacrifice" and the greater of the two main festivals, runs from the 5th to the 13th day of the month of Dhul Hijjah.

Months/Days of the Week/Time

The Arab calendar is a lunar calendar. The 12 months are

  • Muharram (30 days)
  • Safar (29 days)
  • Rabi'a al-Awal (30 days)
  • Rabi'a ath-Thani (29 days)
  • Jumada al-Ula (30 days)
  • Jamada Ath-Thaniya (29 days)
  • Rajab (30 days)
  • Sha'aban (29 days)
  • Ramadan (30 days)
  • Shawwal (29 days)
  • Dhul Qa'dah (30 days)
  • Dhul Hijjah (29 days: 30 days in a leap year)

The seven days of the week are:

  • As-Sabt (Saturday)
  • Al-Ahad (Sunday)
  • Al-Athnain (Monday)
  • Ath-Thulatha (Tuesday)
  • Al-Arbia (Wednesday)
  • Al-Khamees (Thursday)
  • Al-Juma (Friday)

Prayer Times

  • Fajr (Dawn)
  • Shuruq (Sunrise) - the latest time by which Fajr should be performed
  • Dhuhr (Midday)
  • Asr (Afternoon)
  • Maghreb (Sunset)
  • Isha (Night)

MALE DRESS

THOBE: The traditional clothing for men is the Thobe, a loose, long-sleeved, ankle-length garment. Thobes worn in summer are generally white and made of cotton. Thobes worn in winter are generally darker in color and made of wool.

TAGIYAH: The Tagiyah is a white knitted skull cap

GHUTRA: The Ghutra is a square scarf, made of cotton or silk, which is worn folded across the head over the Tagiyah. The end of the scarf can be draped across the face as protection in the event of sandstorms.

AGAL: The Agal is a thick, doubled, black cord which is worn on top of the Ghutra to hold it in place.

FEMALE DRESS

THOBE: Women wear the Thobe - a loose, long-sleeved, ankle-length garment, but, for women, the neck and front can be embroidered and decorated with beads.

ABAYA: The Abaya is a large, black cloak, worn either loose and flowing or wrapped around the body. The Abaya is generally made of silk or synthetic cloth.

BOSHIYA: The Boshiya is a black veil, light in weight, worn across the lower part of the face.

SURWAL: The Surwal are cotton or silk trousers worn by women under the Thobe.

   
 

Royal Commission: Yanbu

 

 

Prominent Industries in Yanbu

 

 

List of Business Delegations visited Saudi Arabia

 

 

Saudi Representative Offices in India

 

 

Chambers of Commerce & Industry in Saudi Arabia

 

 

How to Obtain a Business Visa?

 

 

Guidelines and Instructions issued to Kingdom's Diplomatic Mission Abroad on granting Entry Visa 

 

 

List of Commission Agents

 

Fairs & Exhibitions

 

 

Important Web Links

 

 

Marketing Research and Consulting Firms in Saudi Arabia

 

 

Miscellaneous