Why the Gulf holds the keys to the India–Middle East–Europe Corridor

Announcements of trade partnerships between the EU and Gulf states have begun to set in motion the integration needed to operationalise the India-Middle East-Europe Economic Corridor (IMEC). 

Not only does IMEC seek to enhance connectivity between the two continents, it also provides the United Arab Emirates (UAE) and Saudi Arabia with increased leverage as critical connectors between East and West.

What is IMEC?

The establishment of the U.S.-backed IMEC was initially announced at the 2023 G20 summit, the signatories of which included the European Union, Saudi Arabia and the United Arab Emirates (UAE). Other key states involved in its development include Israel and Oman. 

As well as deepening trade routes and offering a secure data pipeline across continents, IMEC would serve to boost renewable energy security through the construction of a clean hydrogen pipeline. 

Its construction would both reduce dependence on the Suez Canal and diversify transit routes to mitigate some of the risk associated with growing insecurity across global supply routes.

Given that the project includes a Europe-Gulf trade corridor, increased alignment between the two regions will be a key determiner of its economic, political and social outcomes. 

Since its initial announcement, progress on developing IMEC – which requires huge investments and cooperation across signing countries – has been relatively slow.

In particular, given Israel’s central role in plans for IMEC, many believed that the project’s success would hinge on a normalisation agreement with Saudi Arabia.

While the war in Gaza has stalled such a deal, it has not yet derailed long-term plans for the establishment of the trade corridors. In fact, the UAE has worked to present IMEC as a potentially stabilising force in the face of ongoing regional tensions.

The Gulf perspective

While some analysts have portrayed IMEC as an attempt for the U.S. and Europe to counter China’s Belt and Road Initiative (BRI), the dominant view in the Gulf is that these two projects are complementary.

Geopolitically, the announcement of IMEC helps consolidate the UAE and Saudi Arabia’s role as strategic players at the centre of global supply routes.

Plans for other trade routes including BRI and the Iraq Development Road, which would include an Iraq-Turkey corridor, are not as comprehensive or geostrategically significant.

Economically, IMEC provides renewed opportunity to establish strong logistics industries within the UAE and Saudi, while also creating room for the two states to diversify their exports and access newer markets more easily. 

One to watch is Saudi’s investment into mining, both through domestic exploration and external acquisitions and partnerships (including with U.S. and Chinese firms). The ability to directly export this into Europe fills a critical gap. 

Outwardly this also reinforces Riyadh’s commitment to global supply-chain resilience and aligns with Vision 2030 goals. 

An added political benefit is that IMEC would counter China’s own dominance in the market, and thus increase Saudi’s leverage on the global stage as critical minerals are now considered a frontier of geopolitical competition.

IMEC also presents an opportunity to expand Gulf energy exports to Europe.

As EU Member States reduce reliance on Russian supplies and pursue more sustainable options, GCC producers are accelerating investment in renewable capacity and positioning themselves as long-term energy partners.

In July 2025, Saudi Arabia's ACWA Power signed agreements with various European energy companies to export renewable energy and green hydrogen to Europe. 

Similarly, the UAE’s Masdar unveiled its own MoU with partners including the Port of Amsterdam, with the goal of establishing a green hydrogen supply chain from Abu Dhabi to the Netherlands.

Understanding advancements on IMEC

Increased trade partnerships between Gulf and EU countries have been complemented by statements showing renewed political will.

In June 2025, UAE’s Ambassador to Italy stressed the closeness of the two’s relationship as key players in the development of IMEC. 

The UAE’s own approach has differed to Saudi’s in that it is pursuing bilateral relations outside the construct of the GCC forum. In fact, negotiations for a free trade agreement specific to the EU-UAE are currently underway. 

This is part of a larger strategy of differentiating the UAE form other Gulf states, partly through projecting an image of sustainability in spite of continued reliance on fossil fuel based industries. 

In May 2025, the UAE enacted a landmark Climate Change Law that made emissions monitoring, reporting, and reduction planning for all high-emission entities mandatory. 

This shift mirrors the EU’s efforts towards increased compliance. While other policy changes that require businesses to report on ESG metrics are highly likely in the context of the UAE, it is unlikely to be the case in Saudi Arabia. 

Saudi’s own posture is that of increasing economic activity as a result of IMEC, and using it as leverage for political brokering rather than as a means to enact policy change. 

Opportunities for EU-GCC integration 

Alignments with the UAE and Saudi’s economic diversification goals are clear. However, while exporting to Europe may be a goal of Gulf states’ own plans, this risks going against Europe’s strategic areas of interest.