New Delhi: India's Commerce and Industry Minister Piyush Goyal and UAE's Minister of State for Foreign Trade, Thani bin Ahmed Al Zeyodi Wednesday formally launched the series of talks for finalising the India-United Arab Emirates Comprehensive Economic Partnership Agreement (CEPA) by March next year. The agreement is expected to take the annual bilateral trade to $100 billion in the next five years.
Zeyoudi is accompanied by a high-level UAE delegation that will discuss the ways to boost bilateral trade and investment between the two countries. The first round of talks will be held over the next two days.
India and UAE signed a Comprehensive Strategic Partnership in 2017 and aim to conclude the discussion for the comprehensive trade pact by the year-end. The trade deal will require the completion of internal legal procedures and ratification.
The agreement is expected to take the bilateral trade $100 billion with the trade-in services expected to go up to $15 billion in the next five years.
Why is the India-UAE trade pact crucial?
UAE is currently India's third-largest trading partner after China and the US with bilateral trade of about $59 billion in FY 2019-20. The UAE is also India’s second-largest export destination after the US, with exports valued at around $29 billion in 2019-2020.
India was the UAE’s second-largest trading partner in 2019 with the bilateral non-oil trade valued at around $41 billion.
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Moreover, UAE is also the eighth-largest investor in India with investments of around $ 11 billion in the last 20 years while Indian companies invested over $85 billion in the UAE during the same period.
India's major exports to the UAE include refined petroleum products, precious metals, stones, gems and jewellery, minerals, food items such as cereals, sugar, fruits and vegetables, tea, meat, and seafood, textiles, engineering and machinery products, and chemicals.
India's top imports from the UAE include petroleum and petroleum products, precious metals, stones, gems and jewellery, minerals, chemicals and wood and wood products.
India-UAE trade is also important for the country's energy security as India imported crude oil worth $10.9 billion from the UAE in FY 2019-20.
UAE is also home to a large number of Indian expat workers who have become integral to the Gulf kingdom's economy. India and UAE also collaborate on international trade dialogues such as the WTO ministerial conference (12th Ministerial Conference) which will be held in Geneva, Switzerland in November-December this year.
