The United Arab Emirates (UAE), encouraged by the comprehensive economic cooperation deal, anticipates that within two to three years, trade with India would surpass the USD 100 billion level.
The trade between India and the United Arab Emirates was USD 73 billion in FY 2021–2022 and has increased significantly since the two countries signed the comprehensive economic cooperation agreement (CEPA) on May 1, 2022.
Between FY21 and FY22, global commerce increased 68% to USD 73 billion after two years of decline. But after CEPA was ratified, the tendency changed.
With the overall amount of non-oil trade reaching USD 29.5 billion in the first half of 2022, up 22% from the same period in 2021, the bilateral trade has significantly expanded.
In addition, non-oil exports increased 31%, reaching a total value of USD 2.7 billion between May and June, according to Thani Bin Ahmed Al Zeyoudi, the UAE's junior foreign trade minister, speaking at the Indo-UAE economic event hosted by business lobby CII.
Though we've given ourselves five years to increase bilateral commerce between the UAE and India from its current level of USD 20 billion to USD 100 billion, Zeyoudi stated, 'I am convinced that we'll reach the objective considerably sooner, perhaps during the next two or three years.'
Zeyoudi expressed optimism that CEPA will change this over time even though oil still dominates trade, accounting for 62% of the total trade value and just 38% of non-oil trade currently.
According to the minister, bilateral non-oil trade increased by 22% to USD 29.5 billion in the first half of 2022. He also said that the UAE is India's seventh biggest source of FDI with cumulative investments in India totaling over USD 20 billion, of which USD 14.4 billion is FDI.
Between April and June of this year, FDI from the UAE into the nation totaled USD 2.14 billion. Zeyoudi said that if India revives the 60 million tonne refinery with an investment of over 3 lakh crore, his nation is willing to contribute to the now-stalled West Coast Refinery.
Speaking at a different session of the same forum, joint secretary for commerce Srikar Reddy noted that overall exports to the UAE have increased 16% since the CEPA, from USD 9 billion between May and August to USD 10.46 billion, which is commendable given the decline in overall global trade during that time.
Reddy said that the CEPA's exports have been growing five times faster than the nation's total exports. However, exports of goods other than oil to the UAE increased by 14%.
According to Reddy, stones and jewellery still account for about a third of all non-oil commerce, which has increased by 33% to USD 1.4 billion.
UAE-based businesses Mubadala, DP World, Sharaf Group, Lulu Group, Emaar Properties, and RAK Ceramics have made investments in India.
ONGC & PetroResources, Tata Motors, Larsen & Tourbo Middle East, Oberoi Group, Zuari Agro Chemicals, and Essar Steel Manufacturing Company are Indian firms that have made investments in the UAE.