Trade

India and UAE to discuss investment challenges

By Pramod Kumar

October 5, 2023, 6:58 AM

The UAE’s Sheikh Mohamed Bin Zayed Al Nahyan greets Narendra Modi, India’s prime minister, during a visit to New Delhi. Their two governments signed a trade deal last year

Government officials from India and the UAE will hold discussions this week to address challenges impacting bilateral investments and review the trade agreement signed between the two countries last year.

India’s commerce and industry minister Piyush Goyal will commence a two-day visit to the UAE on Thursday and co-chair the 11th India-UAE high-level task force on investments.

Hamed bin Zayed Al Nahyan, a member of the executive council of Abu Dhabi, will lead the UAE delegation.

“The session will evaluate the progress achieved by the joint task force,” the Indian commerce ministry said in a statement.

A joint task force was set up in 2013 to boost trade, investment, and economic ties between the UAE and India.

In February 2022, India became the first country with which the UAE signed a comprehensive economic partnership agreement (Cepa).

Goyal will also hold bilateral discussions to improve trade and bilateral ties.

The meeting comes after India reported a 37 percent decline year on year in foreign direct investment (FDI) to $20.21 billion.

Bilateral trade increased by 15 percent since the Cepa came into force on May 1, 2022. Trade between the two countries was worth $84.5 billion from April 2022 to March 2023.

The Emirates was the seventh largest investor in India in 2021-22, with $1.03 billion of FDI, according to data from the government’s industry promotion and internal trade department.

The UAE’s investments in India include the services, sea transport, power and construction sectors. Between April 2000 and March 2023, the UAE accounted for approximately 2.5 percent of India’s total FDI, amounting to $15.6 billion.

Singapore is the biggest investor in India, putting $17.2 billion in the country over 2022-23, followed by Mauritius ($6.1 billion) and the US ($6 billion).

The central banks of the UAE and India in July signed a framework to promote using the Indian rupee and UAE dirham for cross-border transactions.

The two nations concluded the first-ever crude oil transaction through local currencies between Abu Dhabi National Oil Company (Adnoc) and Indian Oil Corporation last month.