India-UAE Economic Relationship
The economic relationship between India and the United Arab Emirates (UAE) has experienced remarkable growth and transformation. This partnership is marked by a shared vision and alignment of policy, capital, and execution.
Comprehensive Economic Partnership Agreement (CEPA)
- The CEPA, signed in 2022, initially aimed for $100 billion in bilateral trade by 2030.
- This milestone was achieved five years ahead of schedule, prompting a new target of $200 billion by 2032.
Trade and Investment
- Non-oil trade between the two countries grew nearly 20% last year, reaching $65 billion.
- UAE entities have invested over $22 billion in India since 2000, while Indian companies have invested more than $16 billion in the UAE.
- Nearly five million Indian nationals live and work in the UAE, forming the largest diaspora community there.
- The air corridor supports over 1,200 flights a week between India and the UAE.
Key Sectors of Cooperation
- Advanced manufacturing, financial services, technology, and logistics are reshaping the economic corridor.
- Reliance Industries and TA’ZIZ invested in low-carbon chemicals manufacturing in Abu Dhabi.
- Ashok Leyland shifted its electric bus production to the UAE.
- Larsen & Toubro is involved in a major solar-plus-storage project in Abu Dhabi.
Strategic Investments
- DP World committed an additional $5 billion to Indian infrastructure.
- Emirates NBD acquired a majority stake in RBL Bank, marking a significant FDI in Indian banking.
- ADNOC signed LNG supply agreements with Indian oil companies.
- Mubadala invested over $4 billion in Indian health care, renewables, and tech platforms.
Policy and Strategic Initiatives
- The CEPA eliminated tariffs on roughly 90% of tariff lines.
- The 2024 Bilateral Investment Treaty and a strategic defense partnership support long-term business certainty.
Global Reach and AI Collaboration
- Plans to construct Bharat Mart in the UAE as a wholesale hub for Indian goods are underway.
- India and the UAE are exploring joint digital infrastructure initiatives across Africa.
- Collaboration in Artificial Intelligence (AI) is a major frontier; India hosts the AI Impact Summit, and the UAE is a key partner.
Conclusion
The India-UAE economic corridor is a symbol of what is possible when countries align around a shared vision. As India emerges as a global economic powerhouse, the partnership with the UAE is central to its international expansion and strategic realignment.
