The Kingdom of Bahrain has seen significant economic diversification, with non-oil sectors accounting for 84 per cent of the GDP. Oil and gas which contributed around 40 percent of GDP in 2003, accounted for just 15.3 percent of GDP in 2023.
Sectors such as financial services and manufacturing are the major contributors with 16.7 per cent and 14.9 per cent of the GDP respectively. This is seen as a strong economic diversification by an oil-based economy.
Bahrain recently saw an investment commitment of $16.65 million from Indian companies.
H.E. Noor bint Ali Alkhulaif, minister of sustainable development, chief Executive of the Bahrain economic development board (Bahrain EDB), said talks are on with an Indian healthcare company to secure a projected investment of over $50 million.
She said there have been significant investments from Indian companies and India’s FDI stock in Bahrain has grown by 36.6 per cent between 2019 and 2023, adding an average of $102 million annually, with total FDI stock reaching $1.52 billion in 2023.
She further said Bahrain is on the verge of getting a commitment from a Chennai-based advanced electronic manufacturing firm. Besides, Taj Group is also setting up two properties in the kingdom.
Meanwhile, Chemco is gearing up for its third expansion in Bahrain since it first announced its plans to set up its factory in Bahrain in 2013, aiming to boost its rigid packaging production capacity at Bahrain International Investment Park (BIIP), incorporating fully automated production lines to meet the growing demand in Bahrain’s Fast-Moving Consumer Goods (FMCG) sector.
Bhageria Industries is also investing in Bahrain with plans to develop an 11.40 MW solar project. It has been awarded a 10-year turnkey contract by APM Terminals Bahrain, operator of Khalifa bin Salman Port.
Bhageria was first established in 1989 as a manufacturer of dyes and dye intermediates and has since then diversified into solar power generation and Engineering Procurement and Construction (EPC) contracts. The Bahrain project marks Bhageria’s first international solar venture.
“The economic and commercial ties between India and Bahrain trace back 5,000 years to the Dilmun and Indus Valley civilizations. This cumulative investment by Indian companies reflects the strength and competitiveness of Bahrain’s value-proposition and fast-growing reputation as a key regional hub for leading manufacturing and niche technology firms seeking a trusted international destination for expansion,” remarked Alkhulaif.
During the interaction with Alkhulaif, it was highlighted that 3,50,000 Indian nationals (around 25 per cent of Bahrain's population) were living in Bahrain and formed the largest expatriate community amongst other nationalities. Bahrain was also home to the first 200-year-old Hindu temple in the region and there were Sikh, Hindu, Bahai and Buddhist places of worship and facilities in the Kingdom.
The minister mentioned that investing companies could leverage Bahrain’s talent pipeline with 54,000 students enrolled in Bahrain’s Universities with 20,000 students enrolled in STEM Majors (38 per cent of all enrollments) and 5,000 students enrolled in IT programmes. Bahrain was also the first in terms of tech skills among the Arab countries.
Prominent Indian companies such as ICICI Bank, LIC, SBI, Tech Mahindra, TCS, Parle, Lu Lu besides many others have a major presence in the kingdom. SBI has three retail branches with a 20,000-plus retail customer base in the country while Parle the biscuit and confectionery firm has a manufacturing facility and has created 130 jobs in the Kingdom.
The Bahrain EDB is an investment promotion agency with overall responsibility for attracting investment into the Kingdom of Bahrain and supporting initiatives that enhance the investment climate. Bahrain EDB works with the government and both current and prospective investors to ensure that Bahrain's investment climate is attractive, to communicate the key strengths, and to identify where opportunities exist for further economic growth through investment.
Bahrain EDB focuses on several economic sectors that capitalise on Bahrain's competitive advantages and provide significant investment opportunities. These sectors include financial services, manufacturing, logistics, ICT and tourism.
