The Small Peninsula In Persian Gulf Region Economics Essay

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The political system of Qatar seems to be not in its correct historical or chronological time. Shaikh Hamad formed his position within Al Thani family and within Qatar due to which all talks regarding political liberalization had dropped and the state remains to be autocratic. On this basis we would like to assess the continued stability of Qatar.

Tribal's and religious structure of Qatar helps us to understand the political dynamics. Abd al Rahman Ibn Khaldun's Muqqadimah has discussed upon the strength and weakness has contributed to understand the traditional regime. He states that the state should posses the power to have control over different groups in the society and the people should also obey the commands. He further stated that leadership comes from superiority and superiority comes from group feelings which depend upon blood ties. This feeling is yet prevailing in Gulf.

In Qatar family and tribal allegiances are at country level where as the Al Thani family and state building process is inseparable. The state mentioned that Al Thani family was able to maintain political stability by balancing power between several families and also between the tribes and both enjoys benefits equally and also the methodology adopted to distribute the powers among the royal family is another important reason which has added to the political stability.

Shaikh Hamad has brought significant changes by building up new institutions and offices which under the supervision of his loyal supporters which also included his son and daughters. These tribal institutions have helped in maintain political stability or else the involvement of ruling family in high politics is of very big risk for the ruler.

Al Thani is the only family who is the center of potential opposition where in the other merchant families did not play significant role in the political history of Qatar. Rising income in oil and gas allowed Qatar to deepen its capacity in relation to society and many other social groups. The other different quality which we see from political aspect of Arabs monarchies of Gulf is that the government has in store excess wealth in spite of less population and they do not impose tax on people. The mechanism of Qatar is different than other countries. Government promises social and economic welfare in return of political loyalty. This loyalty is the base for the strength in Gulf countries. Citizen is not at all liable to pay any taxes in case of increase services.

The political economy has strengthened prospects of democratization. Oil relationship can be explained through two aspects co-optation and repression. The authority to distribute resources is within the control of ruling party and they have the rights to employ. Vast resources are the only reason for building strong government in both civil and military areas. The key issue according H. Beblawi is that oil revenues allow government to buy political consensus.

Qatar remains autocratic and relies lot on clientism and patronage so this scenario makes it difficult to over throw the current autocratic system.Qatar has also grown in terms of armies and securities. Qatar has second smallest army after Bahrain in entire Arab but US provides lots of protection to and quantum number of US military army are present in Gulf. Qatar is said to be the world largest defense spender from budget allocation point of view which consist of one-third of expenditure spending.

Overall we can state that the political status is full of challenges. The relation between external rent and state system makes Qatar more prone to external challenges.

The major challenge is that they how they would maintain balance between internal and regional stability without any regional conflicts. Other most imp challenge is political liberalization which needs more power. The tension in the area of social and political organization does not lie between tradition and modernity but it lies between the powerful government which dominate people, economic, political and social group.

Qatar is in to the progressive economic, social and political reform. A new constitution was approved in a nationwide referendum and came into effect in June, 2005. In terms of new constitution, the judiciary will be independent and judges can be dismissed only if it is mentioned in law.

In November 2001, Qatar held the World Trade Organization negotiations among 142 countries and Doha Ministerial Declaration was designed to implement trade reform to encourage economic development.

Qatar is not a permanent member of the United Nations Security Council for 2006-2007.Qatar is a member of the Gulf Co-operation Council and contributes to the implementation of integration and to fulfill peoples dream in key areas such as security, stability, trade and economic development.

Due to high security and confidence in political environment of Qatar was given the opportunity to host the 2022 FIFA Football World Cup. Main task for the government in the coming years was to develop infrastructure. The development of new hotels will also attract foreign tourist. Historically, the highest rates of crime have taken place in Qatar and there is expectation of increase in criminal activity in the forthcoming years.

Crime in Qatar

Crime rates in Qatar are very low, but have increased since 2005. Statistics from the Ministry of the Interior discloses that over 900 criminal cases were reported in 2005. In 2009, this figure summed up to just 45,000 cases. Violent crimes have been reported on foreign laborers who are involved in the development of state's infrastructure programs and labor camps.

Foreign visitors were victim of mainly unarmed opportunistic theft, commercial and residential theft and theft from vehicles The government have stated that the Qatar police will now be very much alert and strict in order to curb the crime rate and also the strictness adopted is been visible.

Financial frauds have also increased in large number and government has declared that people should take care while making any financial dealings.

Terrorism In Qatar

Qatar is not victim of the threat of Islamist terrorism. The high number of expatriates and the government related to regional political affairs increases the threat that Qataris likely to face in future. The last major terrorist attack occurred in 2005.

Protest In Qatar

Qatar was one of the states in Middle Eastern that were not affected by the 2011 Arab Spring. The government remains popular among the general populace and political opposition is limited and muted. Public protests are seen in very less and whenever they occur they are non violent.

Road Safety

In order to avoid road accident government gave made many laws in relation to driving but the accident rates are high and the reason is that people at times do not adhere to the traffic rules and regulations. The government have formed rules that and tourist who wants to drive in Qatar has to take license from the airport authority itself and then only the person is allowed to drive. Apart from airport authority no there is no other place where license will be issued to the tourist.

Challenges And Ambition Of Government

The priority of government was to invest in order to diversify the economy and not to be more dependent on energy industry. Government has being concentrating more on education, infrastructure and technology. Government aims in developing infrastructure on a wider scale but it has resulted in to bottleneck example: There are many infrastructure projects which have been delayed stated by Public Work Authority. The problems where encountered due to difficulties in securing building material and equipment. Despite of these problems analyses have analyzed the market is to expand by 5%.

Steady Changes

For HH Sheikh Ahmad political priority was the topmost priority he ascended the throne in 1995 and from that time the state has seen remarkable changes at every level. From the introduction of constitution to revamps of bureaucratic structure and other sectors such as education there has been remarkable growth following the development of gas exports.

It is also seen that many of hallmarks of constitutional democracy are now in place. The Emir had the reputation of being "hands on" but he also allowed his Prime Minister Sheikh Hamad Bin Jassem bin Jabar Ali Thani who has been playing role in formulating domestic and foreign policies. Recent years saw strong revival of tradition of consultation and consensus.

The economy is still driven by the energy industry so efforts have been made by government in order to invest and diversify economy in to education and technology. The implementation of political reforms was not at faster pace. Indeed the political environment is stagnant and the reasons is sobering effect of condition in nearby Kuwait, where the advent of relative powerful legislature has led to repeated bouts of paralysis that affected political environment and very less attempts were made to modernize economy.

Qatar has always attracted foreign investment and the major reason is due to political stability which is seen in Qatar unlike in other countries which is very much necessary for risk adverse investors. Government has strengthened it ties around the world due to rapid growth of Qatar natural gas industry. This trend is accelerating for several years. Doha's increasing economy has led to play important role in regional diplomacy.

This shows some signs as to how Qatar uses its status to enhance it relation with government and business partners. Food security is a central facet of the government diplomatic efforts in African especially in Sudan as Qatar supplies some seeds and equipments as the motive is to develop more farm land.

SOLID STANDING- HH Sheikh Hamad bin Khalifa Al Thani plans on development of economy and society

In 2009 Prime Minister has seen a vision for development of Qatar for next 20 years. He stated that as planned many of the transitional targets have been accomplished and has started to take number of steps regarding of administration organization of the state organ and aimed in enhancing the performance of activities and services.

He further states that their top priority to prepare and qualify a decent and standard livelihood for Qatari citizens. He believes that sustainable development can be achieved only when we invest in human development. HH Sheikh stated that it is of utmost importance to provide qualitative life to Qatari which would lead to economic growth of the country. The establishment of Supreme Level of Council of Health will provide facilities for health care for the people in Qatar living in developing countries and the facility will be of same standard like in developed country.

The re-organization of Supreme Education Council will work in increasing the education level. Similarly Supreme Council of Family Affairs has been organized to strengthen the family status and role in the society. He further stated that in order to achieve sustainable development promotion of economy and diversifying the economy is the utmost priority.

In order to achieve sustainable development efforts were made to increase global investment through strategic partnership and commercial investments with many countries which are connected to petroleum, natural gas and LNG. After putting many efforts Qatar is the world largest in gas industry and leading in LNG exporters and transporters in the world.

Effort which was put in resulted in to inauguration of Adriatic LNG Terminal which is one of the most important project in terms of energy. The project is rated to be the first in its kind. It was preceded by the inauguration of Qatar gas Train 4 which is the integrated project in the world.

The LNG was exported to Britain through South Hook and in 2009 another Ras Gas Train was opened which was one of the leading strategic projects. PM of Qatar finally states that "We are not only keen to maintain the gains but also pursuing building what we have already achieved."

Qatari law

Qatar follows civil law. However Islamic laws apply with respect to the issues of family, inheritance as well as criminal acts.

Labor laws

Many instances of ill-treatment with immigrant laborers and workers have been noted. Qatar has unevenness in maintaining wage standards among immigrant labor and its citizens. Also labor-unions are not permitted. The provisions of sponsorship law states that, sponsors have the monopoly power to workers ability to quit working, cancel their residency permits, also report a worker to be "absconded" to the police authorities, as well as deny permission and stop the worker from leaving the country. Thus sponsors may restrict the laborers movements and laborers may become afraid to report against abuses injustice or claim their rights.

Criminal sanctions

According to the provisions under Qatari Criminal Code, there are allowed punishments like flogging and stoning which are to be imposed in the form of criminal sanctions. Thus the UN Committee which is Against Torture has found that such practices committed breach of those obligations which were imposed by the United Nations Convention Against Torture as well as against Other Cruel, degrading, inhumane Treatments or Punishment. Also Qatar retains (as on date) the death penalty but mainly for threats against national security.

Laws governing alcohol as well as other dietary issues

Consuming Alcohol is legal within the borders of this country, but with many restrictions. Some Luxury hotels do sell alcohol but only to their non-minor non-Muslim customers. For this Foreign nationals must obtain a permit for purchasing of alcohol. Only The Qatar Distribution Company has been permitted for importing alcohol. It operates the only alcohol stores of Qatar. Pork is also allowed to be legally imported again through the same Qatar Distribution Company. It can be purchased by those who hold a liquor permit.

A Short time ago, restaurants situated on the Pearl-Qatar which happens to be a man-made island situated near Doha, were given the permission to serve liquor. However, In December 2011 these restaurants situated on the Pearl-Qatar were banned from selling liquor. Speculation about this decision includes that the government's desire was to project a better and pious image before the country's 1st elections of a royal advisory body as well as due to a financial dispute that had probably occurred between the Qatar govt. and the resort's board of directors.

Duality of the legal system

A unique legal system prevails in Qatar in the Arab Gulf States. Two characteristics define Qatar's particularity. First, as a traditional Muslim society , people have settled their disputes according to the Sharia court (Islamic) court, which applies Sharia law (Muslim law). Second, the independence of Qatar in 1971 marked the termination of British protection and with the British jurisdiction over non-Muslim residents. Consequently the Emir established the Adia court(civil court)to meet the need and problems which resulted from the British jurisdiction.

The foregoing characteristics peculiar to Qatar, have produced a viable dualism in its legal system different from that of the other Gulf states. This is not to suggest that dualism does not exist in the legal system of Saudi Arabia, Kuwait, Bahrain and the United Arab Emirates (UAE).

Dualism, in these systems however is invisible rather than visible. All four dynasties rule on the basis of Islamic Legitimacy and the Sharia law. Yet, in contrast to the four states, where the economic activities and the civil matters of non-Muslims are regulated by special committees or courts, which are supervised by the king and the Council of Ministers, Qatar's Adlia court is not subordinate to the Emir and his ministers. The court is rather and independent body with a well defines structure, something which is not present in the legal systems of the other dynasties. In contrast to the prerogatives of the ministers of justice of Saudi Arabia, Kuwait, Bahrain and the United Arab Emirates (UAE), Qatar's minister of justice may supervise but not legislate secular laws which are the prerogatives if the Adlia court itself.

The unique phenomenon of duality which has never been studied consistently of independently, will allow us to determine the extent of compatibility between the Sharia law and modern law of the adlia court.

The Supreme Council for the Environment and Natural Sanctuaries

The Council undertakes all environmental protection responsibilities. It augments and protects endangered wildlife and its natural habitat; formulates the general policies aiming to protect the environment and effecting sustainable development; monitors the current environment and wildlife-related protective procedures and practices; prepares the necessary drafts of legislation, regulations and decisions on the protection of the environment and operates a national environmental data base - alongside with other environment protection-related functions.

The council is formed of a deputy president and a number of experienced and environment enthusiast members and a secretary-general.

The employees of the council have the capacity to act as law enforcement officers in cases of contravention against the provisions of the council's law and its executing regulations and decisions.

The Supreme Council for the Environment and Natural Sanctuaries organizes nation-wide functions to control the desertification problem as Qatar lies in an arid region, where rainfall doesn't exceed 200 mm per year. The council is also seeking to preserve all land, marine and atmospheric environments. It launched a campaign to destroy the farms that did not abide by environmental and health rules and set up many compounds in which sound health and environmental prerequisites are available.

The Council prohibits trading or dealing in any endangered wildlife, either dead or alive. Such practices are only allowed by a license from the Council. Hunting of wild birds and animals is also strictly prohibited within the boundaries of natural sanctuaries, islands, cities and villages.

To preserve the resources of wildlife the council enforces the wildlife hunting law. This law organizes wildlife hunting and designates the times and places where hunting is ultimately prohibited, as well as the techniques of hunting and the penalties for violations.

The law allows wildlife hunting during the season from 15th September to the beginning of May each year, after which hunting is prohibited.

Hunters are under the obligation not to damage gardens, farms and plant cover; not to interfere or tamper with the life of wild birds, marine turtles, baby animals, wild eggs and nests either by taking possession thereof, damaging, moving or selling them. Such practices are only permitted for scientific research purposes. Even then, a special pre-arranged approval must be secured from the council.

As a committed member of Basel Convention since the 9th of August 1995, Qatar doesn't allow hazardous waste to enter the country as per the provisions of the convention, which stipulate that no waste materials should be buried in any Qatari territory without the approval of the Supreme Council for the Environment.

BUSINESS OPPORTUNITIES IN QATAR AND THEIR LAWS

Businesses are booming in Qatar. However setting up of a business in this country as a foreigner may seem tricky. It is so because the government has brought a new law of 51% partnership of government in this issue.

This law also implies to any company that acts as mid-man between a foreign company or individual wanting to set up a business in Qatar and Qatari national/company again which by law is compensated to own 51% of that business.

In this way, this is a law which helps Qatar remain as Qatari and also ensuring that an economy is full of opportunity and isn't taken advantage of.

This may be important for the people of the country because, despite the large expatriate influence here, it should be the Qatari people who should ultimately control Qatar's destiny. It is known that any country which relaxes the business and immigration laws more than required they risk fragmenting the market, as well as opening it up either knowingly or unknowingly ,to more of the society's ills than they would have otherwise want.

The 51 % law also indicates that the financial strengthening of this country. Qatar can also afford to limit the partnership to just 49 % of the foreign ownership in any company as it does not need any cash injections like those many other countries that do in Europe in the present situation.

However it may prove to be a little too tightly controlled. However , chances are that law might in the long term end up putting people off investing here.

However, Giving up 51 % ownership in your own company isn't something people would easily agree to do in other countries. Its is counter-intuitive for those coming from Europe as well as the US. Because even though you may find what seems as the right partner yet the fact still exists that they control much of your business than you control.

And if it is that your 51% partner is supposed to be an individual instead of a company, then the risk is even higher. Qatar law also states- in the event that an individual dies than his or her all business interests would be passed over to next-of-kin. Again That person would be left with all the options of quitting the businesses or changing the conditions or even liquidating in the case that they don't wish to continue. Being the minority that is, 49 % partner thus is perhaps what most people would perceive as an uncomfortable place to be at.

Qatar of course thinks it as a question of 'our country and our rules', which on their part is fair enough. However it is not a good way of business in such times of globalization.

On one hand Qatar itself is into major business investments on the grounds of foreign countries. But does this guarantee that its international portfolio would be so strong even after Qatar's own investment rules would be applied? Thus, it is about striking the perfect right balance to maintain control and still be flexible.

Qatar also needs to look towards the so-called 'free zones' where-in a business can be operated within the criteria of a certain complex however without regular restrictions.

Right now there are two called 1) Qatar Financial Centre QFC 2) The Qatar Science & Technology Park (QSTP). However if any business falls out of the scope of either finance or of research and development, then they are not much useful.

They also need lots of investment. ExxonMobil Research Qatar for example, which has set up at QSTP, is investing US$25 to 30 million (QR91-109 million) over the first six years, which shows you the level of funds needed to take advantage of these kinds of free zones.

However in 2006 a Qatari cabinet resolution was passed that established the Qatar's first free-zone area, in a ten-square-kilometer-area situated close to the Doha International Airport. Though it was authorized for a full host of industries, yet the project hasn't seen fruition yet.

But sooner it become a reality, better it is for the Qatar's standing.

Thus, A full-fledged free zone and also if possible an eventual review of 51% ownership law, would then show to the world that the country truly is open for business.

Tax Benefits For New Businesses

Income tax relief:

1961: tax relief of 100% for 5yrs from the commencement of the company and 25% thereafter Finance Act (2009) also extended an investment-linked tax incentive to the businesses of setting and operating cold-chain facilities for specified products as well as to the business of setting-up and operating warehousing facilities for the storage of agricultural produce which are commencing operations on or after 01.04.2009. Accordingly, 100% deduction was allowed for the whole of any expense of capital nature incurred fully and exclusively.

Exempt from excise duty:

- Specific goods that are to be used for the installation of cold storages, cold rooms or refrigerated vehicles; for the preservation or storage or transport or processing of agriculture, apiary, dairy poultry ,horticulture, aquatic-marine products and meat.

- Conveyer belt systems used for cold storage facilities intending to the preserve, store, transport or process Mandis, horticulture, apiary, poultry, agriculture, aquatic and marine produce and meat, dairy and warehouses.

- Dairy machinery and milking machines.

Service Tax

A )Exemption from service tax is provided to those services that are related to Erection, Installation or Commissioning of:

- Mechanized Grains Handling Systems etc.

- Equipment used for setting up of or substantial expanding of cold storage

- Machinery/equipment used for initial setting up or for substantial expanding of units for the processing of poultry, agricultural, dairy, aquatic-marine products or meat.

b) Exempt of service tax is also available to the transport of edible products like fruits, milk, eggs or vegetables by any goods transport agency. Exemption has also been expanded such that it now includes pulses and food grains.

Political Liberalization and Royal Factionalism

Qatar's too much publicized and famous liberalization campaign which began in mid-1990's was due to the direct results of the efforts made by the new "Amir", namely Shaikh Hamad, in order to compensate for most of his fragile bases of support which were in the ruling so called Al Thani family done by appealing to the broad base of Qataris as well as to international community.

History reveals that Al Thani family has been among the only centers of potentially opposing the reigning Amir, along with merchant families or along the religious establishment. They were politically neutralized because of a variety of structural and historical reasons.

However, in relation to each of these two groups the state had pursued a nuanced policy comprising of simultaneous co-option as well as political incapacitation. Alongside, the steady rise in oil as well as gas revenues allowed government of the state to deepen significantly its capacity with respect to the society. thus by doing so, it ensured that groups from the civil society would not rise to the positions of prominence.

From the Al Thani, prominently Sheikh Hamad undertook many of the significant changes, but not the least from it was the creation leading to new institutions as well as offices which were staffed by Sheikh Hamad's loyal supporters, which included some of his daughters and sons. Also he streamlined whole of the line of succession so as to include thus only his very own descendants.

At least for now, as the traditional political dispute between the Al Thani is thus silenced, all the talks of liberalization were dropped and Qatari state remains thus fundamentally autocratic.

Future political pattern expected in the middle-east

The impact of events in and since October 1973 upon politics within the individual oil-exporting states of the middle-east may have been less urgent than their impact on politics in the oil-importing world, but it is unlikely, in the final analysis to be less traumatic. Within a few months a group of countries with enormous territory but in the aggregate, a comparatively tiny population has been catapulted into a new economic era.

Even for those countries like Iran and Iraq whose populations are relatively large and whose external balances of payments may soon be in deficit accumulated surpluses and confident expectations of future increase a means that, for the moment at least the traditional constraint upon economic development imposed by the availability of investment capital has ceased to dominate planning. With the contraction of world demand for oil since 1973, some must resort again to borrowing while some and some will have to trim or defer particular development projects.

The fact remains that for all practical purposes, their current ability to buy the essentials of economic luxuries if not all of them seems effectively unconstrained. During the period of 1974-6 as an indication, OPEC having paid for their enormously increased imports will have accumulated a surplus income from oil sales. Obviously that surplus is distributed very unevenly.

Nevertheless, it is clear that for most oil exporters, especially in the Gulf, a substantial financial reserve have already been built-up, which can be drawn upon to support their continued development in the future even if , for some reasons, their current earning power should diminish.

Advantages of Doing a Business in Qatar

1. Strategic and a unique location

Located at the crossroads of the Middle East region

Part of the Arabian Peninsula

Arabian Gulf and Iran are situated in the east of the country, Saudi Arabia in the west, UAE in the south

Qatar's capital, Doha, parallels the length of the coastline, which runs 563 km. This has contributed to the presence of a number of ports used for the import and export of goods to other parts of the region.

2. Stable political environment

Guaranteed freedom of beliefs, expression, the press, and the protection of intellectual property rights.

Qatar enjoys excellent trade relations with a number of big and powerful countries in the world. Due to the wise and tolerant domestic policies, it was able to gain leadership in the development of foreign trade.

3. An economy with strong pillars directed to free market

Economic policies based on the command of private sector and trade liberalization and merging into the world economy, the State of Qatar became the twenty first member of the World Trade Organization (WTO) in 1994. It is a member of the GCC, Organization of Petroleum Exporting Countries (OPEC), International Monetary Fund (IMF), Organization of Arab Petroleum Exporting Countries (OAPEC) in addition to the Arab League and the United Nations.

Qatar came in the first place as the highest income among individuals between the GCC countries, where the individual share in Qatar reached about USD 73,000.

Local investments size total QR 820 billion (USD 225 billion) starting from the current year and until the year 2016, which will not come from the oil sector as mentioned in the national strategy for the development.

Qatar has become the centre for sports in the Middle East and the world after winning the bid to host the 2022 World Cup. The country intends to spend no less than USD 160bn to execute wide development projects during the next decade especially those projects related to the World Cup.

4. Great natural resources

The joint investments with international oil companies in executing various big projects in the fields of gas and oil, exceeding hundred billion dollars.

Qatar enjoys 14% of the discovered natural gas reserve in the world. The gas reserve in Qatar reaches about 900 cubic foot trillion and is the third biggest reserve in the world

The region contains 51% of the world reserves in oil and gas and 24% of the world production of oil and gas.

5. Giant economic projects

The State of Qatar will invest about USD 160bn until 2022, in many infrastructure projects in preparation for the World Cup. Qatar also plans not reduce its reliance on oil and gas revenues by more than 20 to 25 percent in 2015. In 2020, Qatar hopes to completely break away from its reliance on the oil and gas revenues

Establishing railway networks, Qatar-Bahrain Bridge and the completion of the New Doha International Airport are just a few of projects underway.

6. A bundle of incentives and the exemptions to encourage investment

The provision of advanced infrastructure and the nominal price to rent land in the industrial areas

Duty exemption for construction materials and equipment imports have been granted to principal contractors working on projects undertaken in the oil, gas, water and electricity sectors.

Permission given for foreign investor to invest 100% in some of the sectors such as the agriculture and the education

Allocation of the industrial land at a nominal rent starting at 1 Qatari riyal (USD 1 = QR 3.64) per square meter per year for foreign investors which the rent for a long time period, renewable, but not exceeding more than 50 years.

Exemption of the invested foreign capital from income tax for 10 years from the date of operating investment project

Exemption of the foreign investor in the industry field from the customs duties on raw materials imports and half fabricated materials necessary for the production, which is not available in the local markets

Signing agreements of commercial and economic cooperation in the protection of mutual investments and the prevention of double taxation between Qatar and a number of the world countries.

Qatar joined of the World Intellectual Property Organization (WIPO) in 1976. They also signed Arab agreements protecting the author's rights since 1986 as well as the agreement of Berne, which protects the literary and artistic compilations in 2000. Qatar also signed the agreement of Paris for the industrial property protection in 2000.

7.  A penetration into greatest international markets

The main market of Qatari exports is now Asia, especially Japan, the nation which buys the most of the crude oil that is being exported. In addition, China and India imports large amounts of fertilizers and petrochemicals. Two main countries that buy liquefied natural gas are Japan and Korea.

At present time, crude oil and liquefied natural gas continue to dominate over all types of Qatari exports and it may continue for the next few years. With the persistent steps in the improvement of foreign investment laws that the government carries out these days, and with the direction towards the employment of oil revenues and gas in the diversification of new economic fields, analysts and economic experts see that the image may soon change greatly.

All industries related to the oil and gas in Qatar export its products successfully to different countries. Qatar Petrochemical Company (QAPCO) for example, sells petrochemicals within the GCC countries in addition to India, Pakistan and Australia. Products of Qatar Fertilizer Company (QAFCO) are mostly shipped to India and China, while the iron and the steel that Qatar Steel produces are sold to other countries in the Gulf Cooperation Council.

8. The free zones and the industrial cities

Ras Laffan Industrial City

It is the newest industrial city in Qatar. This city is located at a distance of 80km northeast of the capital, Doha, and the area reaches 106 kilometers per square meter. About 6,500 employees are there to provide production.

Mesaieed Industrial city

Mesaieed Industrial City is situated in an area about 40km south of Doha. The city is managed by the Mesaieed Industrial City, a subsidiary of Qatar Petroleum. It was established in 1996 as a single point authority to provide "one stop" services to businesses in Mesaieed, to develop a strategic plan for the allocation of land and to provide port, marine and infrastructure facilities, such that these facilities are utilized to their maximum capacity.

The city home to major industrial projects that includes crude oil, hydrocarbon products, petrochemicals, iron, steel and other supporting light industries.

Industrial Area

This industrial area was established to execute His Highness' instructions to create an industrial zone for light and medium projects. Its facilities include light, gas, water and sewage services.

The new Industrial Area has a special administration targeting the supervision and the follow-up under the policy of a single office that gives the industrial license and the land required for the project at the same time, according to specific conditions and regulations.

The Industrial Area is considered a pioneer in its service and is the newest industrial area in the world.

Dukhan City

Dukhan City is one of the first sites in which Qatar started the exploration and the production of oil. An urban strategic plan was applied to develop this region. It implemented this plan to the oil sector in 2003 and will continue until 2022.  Around 193 projects have been executed and continue to be executed in the coming twenty years which is divided into four stages.

9. Competitive and qualified human resources

Trained and qualified labor force

Competitive salary rates

Modern labor laws

10. Communications services and an infrastructure at international standards

Has an infrastructure work through digital technology providing distinguished services worldwide

Internet services options to suit with private sector needs

Direct trips by Qatar's flagship carrier, Qatar Airways, to all main cities in Europe, Middle and the Far East, North and South America and Africa in addition to international airline transfers

A new highway network

Renowned shipping lines and container carriers which guarantees the flow of commodities throughout the region.

11. An attractive investment climate

Freedom of entry and exit of capital to and from the country of origin

Freedom to transfer profits to origins when the investor wants to

Freedom to transfer foreign currencies and the stability of the exchange rate

Freedom of Qatari economy

Ease in the procedures for registering and licensing businesses

Exemption from both income tax and the tax on the exports revenues

Exemption of customs duties for imported raw materials used in the export industries

Freedom of transfer of capital, profits and salaries to abroad and also by currency exchangeable

12. A high quality of life

Investor enjoys high class living standard

Presence of government and private education with a high level in French, English and Arabic

Abundance of the health services at par with the international standards but at reasonable prices

Cultural centres, local societies and active international works and an advanced communication society are available

Traditional festivals, cultural entertainment and wealth from archaeological site

Great dining options and excellent entertaining nightlife

Market Challenges

Foreign Investment: With certain exceptions, Qatar's foreign investment law limits foreign ownership of local entities to 49% of the entity's capital. Foreign investors may own 100% of an entity's capital in sectors like agriculture, industry, health care, education, tourism and the exploitation and development of natural resources subject to approval by the Government of Qatar ("GOQ").

Foreign investors must receive permission from the government to invest in the banking and insurance sectors. Foreign investment is not allowed in commercial agencies and real estate, although with respect to real estate there are limited

opportunities for foreigners to own interests in select real estate projects in the West Bay Lagoon area, Al-Khor district, Pearl of the Gulf Development project and certain other designated zones.

Banking: A total of 19 banks operate in Qatar, including 11 Qatari institutions and eight foreign branch banks. Out of the 11 Qatari banks, eight are commercial institutions (Ahlibank, Al Khaliji Bank, Barwa Bank, Commercial Bank of Qatar, Doha Bank, International Bank of Qatar, Qatar Development Bank, and Qatar National Bank); the other three are Islamic institutions (Masraf Al Rayan, Qatar International Islamic Bank and Qatar Islamic Bank). The eight foreign banks include: Arab Bank, Bank Saderat Iran, BNP Paribas, HSBC, Mashreq Bank, Standard Chartered, Barclays Bank and United Bank.

Commercial Agents: The Commercial Agents law requires all agency agreements to be exclusive arrangements.

Corporate Income Tax: The corporate income tax rate has been cut to a flat rate of 10%, effective January 1, 2010. Previously, foreign companies had to pay between 5 and 35 percent.

Government Procurement: There are concerns about transparency in government procurement, particularly regarding the following: a lack of clarity in the conditions and criteria of tenders, improper notification or explanation to non-qualifying companies, irregularities in the awards process, and the inability to formally challenge awards.

Import Duties: The import duty for most processed food products is a flat five percent ad valorem. There is no import duty for live animals, fresh fruits and vegetables, seafood, grains, flours, tea, sugar, spices and seeds for planting. Existing import duties on tobacco products have been increased two-fold, from 100 to 200%, based on talks between the ministers of finance and health of several GCC countries.

Import Restrictions: Qatar has no import quotas. However, non-tariff barriers arise occasionally. For example, a ban on pork was maintained until late 2011 but has been lifted as of 2012. Sale of pork is, however, regulated heavily, with sales being restricted to only be handled by Qatar Distribution Company.

Inflation: The booming economy in Qatar is leading to shortages of materials and labor. This is compounded by a rapidly growing population, which is approaching two million people, up from just 700,000 five years ago. This has an inflationary effect on the economy, with housing prices particularly hard hit in years up to 2010. Inflation levels hit 3.3% in 2011 and are expected to average at 4% in 2012, with housing prices remaining depressed and the main brunt of burden falling upon food prices. The cost of living in Qatar is high by U.S. standards.

Standards and Labeling: As part of the GCC Customs Union, the six Member States are working toward unifying their standards and conformity assessment regimes. However, each Member State applies its own standards until a uniform

GCC standard has been set. Labeling and marking requirements are compulsory for any products exported to Qatar.

Transparency: Qatar ranked 22nd on Transparency International's 2011 Corruption Perceptions Index, outperforming all other Middle Eastern economies.

Food Labeling and Packaging: Arabic or bilingual English and Arabic language labels (or stickers) are required for all food products. Production and expiry dates are required to be on all "original" food labels.

Market Opportunities

The Government of Qatar will continue to maintain high levels of capital spending on education and health. The government plans to invest $9.9 billion on these sectors in the 2012/2013 fiscal year, accounting for 15% of its 2010/2011 fiscal budget. The Government of Qatar's strong commitment to invest in economic diversification through public spending on transportation, health care, education and housing projects will create multiplier effects on the rest of the economy, contributing to increased consumption and demand for better quality housing, office and retail facilities.

Energy Sector: Qatar has attracted an estimated $100 billion in investment, with approximately $60-70 billion coming from the U.S. It is estimated that Qatar will invest over $120 billion in the energy sector in the next ten years. Although a moratorium on North Field development is in place until at least 2015, Qatar is committed to diversifying within the hydrocarbon sector and developing its petrochemical industries in particular. Construction: It is estimated that Qatar will invest $200 billion in roads, rail, port and other infrastructure development, housing and real estate, health/medical and sanitation projects in the next decade. USD 17 billion of Qatar's FY 2012 budget has been allocated to public works (25% of the total). The GOQ and private sector are actively seeking project designers, engineers and managers, in addition to needed production inputs like cement and heavy machinery and equipment.

Qatar imports over 90 percent of its food. Major food suppliers to Qatar include the EU, Australia and Saudi Arabia. Most of Qatar's food product imports transit through the United Arab Emirates.

Other sectors with significant opportunities include: Education and Training Services, Information Communication Technologies, Architecture, Construction, Engineering Services, Air Conditioning Equipment, Safety and Security, Defence Sales, Oil and Gas Equipment and Services, Medical Equipment and Services, and other sectors.

Overview of medical and health-care sector in Qatar

Unit: USD thousands

2010

2011

Total Market Size

171.12

90.30

Total Local Production

0

0

Total Exports

N/A

N/A

Total Imports

171.12

90.30

Imports from the U.S.

80.15

42.91

Exchange Rate: 1 USD

3.64 QR

3.64 QR

Total Market Size = (Total Local Production + Total Imports) - (Total Exports)

Source: Trade estimates, U.S. Census Bureau, Qatar Planning Council

Health care is a priority concern for the Qatari leadership. The Qatari Government is constantly upgrading the quality health services using technology, international expertise and knowledge. In Qatar, healthcare services are either free or highly subsidized.

According to industry estimates, the market for medical equipment will grow over the next five years. The market relies on imports from Europe, Asia and the United States. In fact, the U.S. is one of the leading exporters of medical equipment, medical supplies, medicines and pharmaceuticals to Qatar. Qatar's strong interest in importing medical equipment, healthcare technology and supplies from the U.S.is driven by two factors:

The rise of new construction projects for hospitals and health care centers; and

Qatar's lack of local production capacity in this area.

Sub-Sector Best Prospects

• Medical Equipment

• Medical Supplies

• Equipment and supplies for persons with special needs

• Specialized medical services

• Healthcare technology

• Books and publications

• Training

Opportunities in health sector

• Hamad Medical City, owned and funded by Hamad Medical Corporation, is a $900 million integrated medical complex consisting of several specialty hospitals. Work is underway to build an associated medical complex that will consist of the following: a 338 bed-Pediatric Hospital, a 200-bed Orthopedic Hospital, a 230-bed Physical Medicine and Physiotherapy Hospital, a 40-bed Day Care Surgery Center, and a 228-room Home Care Center for the elderly.

• Sidra Medical and Research Facility, owned and funded by the Qatar Foundation with an $8 billion endowment, Sidra will be the first academic medical center in Qatar based on a U.S. model. Working in partnership with the Weill Cornell Medical College in Qatar and the Hamad Medical Corporation (HMC), the hospital's main focus will be to provide world-class medical care for women and children, to train medical students and clinicians, and to specialize in pregnancy health, infertility, genetic abnormalities, and other diseases specific to females. Several U.S. companies providing medical equipment have already won lucrative contracts with HMC.

SUMMARY

From the analysis of political environment we came to the conclusion that Qatar has the most stable political environment compared to other countries. The other beneficial thing which we encountered was that the government does not tax the residents of Qatar so the income of people over there is tax free which is the most positive point for the growth from the societal and also the it depicts that the government in Qatar is very rich and have abundant amount of financial resources which is invested in the infrastructure of the country and also in other sectors such as educational sector technological sector.

Qatar also known as state of Qatar is a sovereign Arab state. Qatar has been ruled absolutely by Al-Thani family since the mid 19th century. Formerly a British protectorate noted for pearl hunting, it became independent in 1971. Since, then it has become one of the region's wealthiest states because of its enormous oil and natural gas revenues.

The most important positions in Qatar are held by the members of the al Thani family, or close confidants of the al - Thani family in 1992 Qatar built a strong military ties with united states of America and Qatar is now location of U.S. central command's forward headquarters and the combined air operations center. It was observed that earlier rules of Qatar had many internal disputes but from Al-Thani times there has been no dispute so far.

Qatar tops the list world's richest countries by Forbes in 2010.Qatar did not emerge as a separate political entity until the mid 19th century when the British recognized sheikh Mohamed bin Thani. This recognition came in the aftermath of maritime Qatari Bahrain war of 1867 - 1868, prior to which the British saw Qatar as a Bahraini dependency of al - Khalifa. In march 1893, at the battle of Wajbah (10 miles west of Doha), Sheikh Jassim defeated the ottomans and forced a treaty that would later form the basis of Qatar emerging as a separate country. As we all know that Qatar is rich in petroleum and oil which is one of the main sources of income earning.

The constitutional development in Qatar graduated from one phase to another, keeping pace with the development of the country and its economic growth. The first provisional constitution was issued in 1970 before independence and it was amended in 1972 after independence, in order to cope with the requirements and responsibilities of the new phase.

Since that time the objectives and features of the state policy and its Gulf, Arab and Islamic affiliations were determined. The State's authorities and apparatus acquired their experience from actually practicing these authorities in the internal and external domains.

Amendments were made on some provisions of the provisional basic statute in regard to the executive authority and hereditary rule so as to conclude the constitutional arrangements in the country. The judiciary act and other basic laws, which were enacted to regulate civil and commercial interactions, were other steps on the way to build up the government apparatus and lay down the foundation for the rule of institutions and the law. To reach that goal, an Emiri Decree was issued in July 1999 to form a high level committee to draft a new, permanent constitution for the country, one of the main provisions of which would be to cope with the achievements of the State of Qatar and to meet the aspirations and hopes of the 21st century.

The constitutional development in Qatar formed from one phase to another, for the development of it and making competitive itself globally with economic growth. The first constitutional has been issued in 1970 before independent and it was necessary in 1972. It was for coping with the requirements and responsibilities of the new phase.

Since that time the objectives and features of the state policy and it's Gulf, Arab and Islamic and willing was determined. The state's authorities and apparatus needed their experience from actually practicing these authorities in the internal and external domains. The Judiciary Acts and other basic laws enacted to regulate civil and commercial interactions that were other steps on the way to build up the Government Apparatus.

After government constitutional, an emir decree was issued in July 1999 to form a high level committee to draft a new that was permanent constitutional for the country which is one of the main provisions of which would be to cope with the achievements of the state of Qatar. It becomes to meet the aspirations and hopes of the 21st century.

Thereafter, the prime minister, Sheikh Abdullah Bin Khalifa Al-Thani formed a ministerial committee mandated to study the planning of future economic that was industrial development in the country in the light of current global trends at end of June 1999.

Emir is the head of the constitutional authorities, holding both legislative and executive powers. The Council of ministers assists in implementing the general policies of the state and the Advisory Council gives recommendations and advice on public matters referred to it by the Council of ministers. The emir is the ruler of the state and ruler in Qatar is hereditary within the family of Al-Thani that is power is transferred from father to son.

If no son is available in their family then power is transferred to the person whom the Emir chooses within the family of Al-Thani in accordance with the Emir decision No (3) for 1995 amending some provisions of the amended provisional constitution on hereditary transfer of power. the emir holds both legislative and executive powers with the assistance of council of ministers and the advisory council.

There were changed and constitute some form. The important provisional basic statute of rule in the country for 1972 allows that. Qatar is a sovereign and independent Arab state, Islam is the official religion of the country and the Islamic law is the principal source of legislation. Democracy is the basis for the system of government. The official language is Arabic and the Qatari people are part of the Arab nation. The state exercises power over all the territories and territorial waters, which fall within its international borders. it has no right to give up sovereignty or withdraw from any part of those territories or waters.

The state is responsible for maintaining the integrity, security and stability as well as using all its resources to defend it against any act of aggression.

Qatar held a constitutional referendum in 2003, which was overwhelmingly supported. The first municipal elections with men and women voters and candidates were held in 2007 and 2011. The first legislative council's 45 seats are planned for 2013. Suffrage is currently limited to municipal elections and two thirds of the seats in the legislative council, with the voting age number of residents who are prevented from applying for citizenship. The selected municipal Council has no executive powers but may offer advice to the ministers.

Qatar's constitution has passed through transitional stages starting in 1970 when the first provisional system of governance was enacted. This system was revised in 1972 after the national independence and amended to address the requirements and responsibilities of the new stage. Thereafter, the features and objectives of the State's policies and affiliations were defined at the regional, Arabic and Islamic levels. The government and its organs drew much benefit from the actual performance of authority at the domestic and international levels

The legislative amendments tackled some articles of the basic modified provisional system pertaining to the executive authority and the articles pertaining to the inheritance of the Emir's post as an integral part of the constitutional situation in the country. In the same manner, the issuance of the judicial authority law and other basic laws that regulate civil and commercial transactions were complementary steps towards the establishment of the State's organs and laying down the foundations of the State of law and institutional governance.

The Qatari authorities seem to keep a relatively tight rein freedom of expansion and moves for equality. The Freedom in the World 2010 report by Freedom House lists Qatar as "Not Free" and on a 1-7 scale rates the country a 6 for political rights and 5 for civil liberties. As of 2011, the Democracy Index describes Qatar an "authoritarian regime" with the source of 3.18 out of 10, and ranks 138th out of 167 countries covered.

The citizens of Qatar enjoy equal civil rights and responsibilities without discrimination on grounds of race, origin or religion. Laws cannot be applied retroactively and no sentence may be passed except under the terms of existing law.

A suspect is innocent until is proven guilty and is entitled to a fair trial. The civil liberties guaranteed by the state include the right of residence, freedom of press and publication and private ownership. These rights cannot be circumscribed except where the practice of such rights contravenes the law or the public interest. The basic statute requires all those residing in the state to observe public order and respect public customs and morals. On its part, the state is responsible for providing public jobs for all residents.

Judges are independent and their decisions are taken and implemented in accordance with the law. The proceedings of the courts of law are open to the public unless the court decides of its own accord or at the request of an opposing party to hold them in closed session if that could best serve the interests of public decency or general order. In all cases, sentences are pronounced in public sessions.

Arabic is the official language in the courts of law in Qatar. The court hears the evidence of non-Arabic speaking opposing parties and witnesses through a translator who works under oath and observes all honesty, integrity and sincerity.

The Consultative Assembly has 35 appointed members with only consultative tasks. However, the 2003 Constitution of Qatar calls for a 45 member elected Legislature, which is to be made up of 30 elected representatives and 15 appointed by the Emir. In 2006, Prime Minister Al Thani-then the Deputy PM- announced that elections would be held in 2007. However, only a legislative council to review the subject was created that year.

The actual elections have been postponed three times; most recently in June 2010, when the Emir extended the Consultative Assembly's tenure until 2013.Press freedom has been increased in Qatar and the Qatari satellite TV station Al-Jazeera has become one of the most important broadcasters in the Arab world. Elections in 1999 for a 29-member municipal council were the first in which Qatari women were allowed to vote and stand for office.

The constitution which provided for limited democratic reforms came into force in 2005 in Qatar. The new basic law provided for a legislature - the Advisory Council - with 30 elected members and 15 members appointed by the emir. The emir said that Qatar will hold its first national legislative elections in 2013.

The population in Qatar is very small. Foreigners - including the laborers attracted by a construction boom there - outnumber the natives. Oil money funds with many services being free or heavily subsidized. Possessing around more than 15% of the world's proven gas reserves, Qatar is ambitions to become a global energy giant!

Qatar is very active on the local and world stage, having interfered in disputes in the Middle East and Africa. It is currently pursuing an Afghan peace deal.

The constitutional development in Qatar graduated from one phase to another, keeping pace with the development of the country and its economic growth. The first provisional constitution was issued in 1970 before the independence which was amended in 1972 after the independence, in order to cope up with the requirements and responsibilities of the new phase.

Since that time the objectives and features of the state policy and its Gulf, Arab and Islamic affiliations were determined. The State's authorities and apparatus acquired their experience from actually practicing these authorities in the internal and external domains.

Amendments were made on some provisions of the provisional basic statute in regard to the executive authority and hereditary rule so as to conclude the constitutional arrangements in the country. The judiciary act and other basic laws, which were enacted to regulate civil and commercial interactions, were other steps on the way to build up the government apparatus and lay down the foundation for the rule of institutions and the law.

To reach that goal, an Emiri Decree was issued in July 1999 to form a high level committee to draft a new, permanent constitution for the country, one of the main provisions of which would be to cope with the achievements of the State of Qatar and to meet the aspirations and hopes of the 21st century. 

Eyeing the opportunities in varied areas of business, India is looking for chances to increase its trade volume with Qatar, in the next five years. A meeting of entrepreneurs was held in the presence of Indian Ambassador Deepa Gopalan Wadhwa. Among others present were local entrepreneur and Padma Shri recipient C K Menon of Behzad Group of Companies.

Formed around 116 years ago, the CII is a frontline organisation with a direct membership of more than 8,100 business entities which is spread all over the Asian economy.

While as the trade between Qatar and India was around $882.30mn in 2004, with India importing goods worth $672.90mn, the trade figures reached around $4.17bn in 2009. While the Indian export was worth $674mn to Qatar, Qatar's exports to India was worth $3.498bn in the same year. India's trade with the Arab region was around $113.95 in 2009.

CII deputy director Pantheeradi Haridas, who is also the manager of the current business mission, said in view of the growing opportunities in the GCC states, Indian companies are accelerating their efforts to look for more business opportunities, especially in a quickly growing economy such as Qatar.

"Compared to other places in the region, we are aware that Qatar is recording a much faster economic growth, backed by a progressive government that has development as its key focus. Perhaps few other countries of the region have initiated as many economic reforms as Qatar has introduced in the last one decade," said Haridas.

Inquiries held with the mission members revealed that the UAE contributed around 42% of the whole Indian business with the Arab region, with India exporting goods worth more than $24bn to that country in 2009. Indian imports from the UAE were more than $23.8bn in the same year.

After UAE, Saudi Arabia is the second largest regional trading partner of India, having around 22% of the South Asian nation's business with the region."In view of the massive developments going on in Qatar, we hope to expand businesses with Qatar considerably in the next few years and trade equations are hence bound for a major change during the period," said Haridas.

Efforts made by India to host a trade conclave with the GCC countries in Mumbai in 2004 has helped India to increase businesses with the region's countries in the past few years, as noted by the CII official. Each of the GCC states has seen a major hike in its spending on various sectors, mostly in infrastructure and utilities, as pointed out by Haridas.

Remembering the visit made by HH the Emir Sheikh Hamad bin Khalifa al-Thani, to India, the CII official said the Qatar delegation that accompanied HH the Emir has made a elaborate study on the increasing opportunities in India during his visit to India.

The current delegation, as mobilised by the CII, has as its members entrepreneurs representing areas as turnkey construction and other infrastructure projects, facilities management, polymer, sc

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