Bilateral Economic & Commercial Relations

India and UAE have shared trade links through the centuries. The trade, which was dominated by traditional items such as dates and fishes, underwent a sharp change after the discovery of oil in UAE.  With the emergence of UAE as a unified entity in 1971, exports from India started growing gradually over the years. The real impetus, however, started after Dubai positioned itself as a regional trading hub by early 1990s and about the same time, the economic liberalization process started in India.

Growing India-UAE economic and commercial relations contribute to the stability and strength of a rapidly diversifying and deepening bilateral relationship between the two countries. Both sides are striving to further strengthen these ties for mutual benefits. India-UAE trade, valued at US$ 180 million per annum in the 1970s, is today around US$60 billion making UAE, India’s third largest trading partner for the year 2014-15 after China and US.  Moreover, UAE is the second largest export destination of India with an amount of over US$ 33 billion for the year 2014-15.  For UAE, India is the largest trading partner for the year 2014 with an amount of over US$ 28 billion (non-oil trade).

India’s Major Exports and Imports to the UAE:

India’s exports to the UAE are well diversified with a large basket. India’s major export items to the UAE are: Petroleum Products, Precious Metals, Stones, Gems & Jewellery, Minerals, Food Items (Cereals, Sugar, Fruits & Vegetables, Tea, Meat, and Seafood), Textiles (Garments, Apparel, Synthetic fibre, Cotton, Yarn) and Engineering & Machinery Products and Chemicals. India’s major import items from the UAE are:  Petroleum and Petroleum Products, Precious Metals, Stones, Gems & Jewellery, Minerals, Chemicals, Wood & Wood Products.   India also imported 16.00 MMT of crude oil from UAE in 2014-15.

Investments :

There is an estimated US$8 billion UAE investment in India of which around US$3.01 billion (Jan 2015) is in the form of foreign direct investment, while the remaining is portfolio investment. UAE is the tenth biggest investor in India in terms of FDI. UAE’s investments in India are concentrated mainly in five sectors: Construction Development (15.52%), Power (13.09%), Metallurgical Industries (9.90%), Services Sector (9.58%), Computer Software & Hardware (4.90%).  To further attract investments, a High Level Task Force was formed in May 2012 with Hon’ble CITM and His Highness Sheikh Hamed bin Zayed Al Nahyan,  Chairman of Crown Prince Court of Abu Dhabi and Managing Director, Abu Dhabi Investment Authority as Co-Chairs.  This followed the visit Sheikh Hamed to India in January 2012 at CITM’s invitation when he had interactions with various Cabinet Ministers, trade and industrial bodies and financial institutions and regulatory authorities. The first meeting of the India-UAE High Level Task Force on Investments (HLTFI) was held on 18/02/2021 at Abu Dhabi. An agreement was reached between the two countries on the format and structure of future discussions, and the meeting decided to establish sub-committees in areas such as infrastructure, energy, investment and trade, manufacturing and technology, aviation and transport for investment purposes. Sheikh Hamed announced an initial allocation of USD2 billion for investments in infrastructure projects in India and support for the establishment of a strategic oil reserve in India. CITM also highlighted India’s desire to participate in the oil and gas sector of UAE.  On 13 March 2013, EAM visited Abu Dhabi and held meetings with the Crown Prince Sheikh Mohammed bin Zayed Al Nahyan, Chairman of Crown Prince Court and MD of ADIA Sheikh Hamed and Foreign Minister Sheikh Abdullah.  He assured them of the steps being taken by the Government of India on the promotion of FDI inflows into India and also on the early conclusion of BIPPA with UAE.  On 23rd April, Etihad airlines announced its decision to invest US$379 million in Jet Airways for a 24% stake in the shareholding.  On 26th May, Finance Minister visited Dubai and Abu Dhabi and had meetings with the Finance Minister of UAE, Crown Prince of Abu Dhabi and the Managing Director of ADIA.  Opportunities available for investments in India were highlighted. FM also assured the early conclusion of BIPPA after one / two rounds of negotiations. Two more rounds of negotiations were held in July (in India) and October (in Abu Dhabi) and the agreement was signed on 12.12.2020 at New Delhi. The second meeting of the India- UAE High Level Joint Task Force on Investments (HLTFI) was held on 3.3.2021 at Mumbai, saw wide-ranging discussions on priority sectors of engagement for channeling investments between the two countries. Shaikh Hamed bin Zayed Al Nahyan, Chief of the Abu Dhabi Crown Prince’s Court and Chairman of Abu Dhabi Investment Authority (Adia), led the UAE delegation and co-chaired the HLTFI meeting with Sh. Anand Sharma, Hon’ble Minister for Commerce and Industry. The first meeting was held in February 2013 in Abu Dhabi, after the meeting, several joint working groups were set up to address issues of mutual interest in sectors including infrastructure, investment and trade, energy, manufacturing and technology, aviation, information and communication technology and legacy issues. On the second meeting in Mumbai, an action plan was agreed to expedite progress across all these joint working groups.

 Joint Ventures:

There are a number of joint ventures and investments undertaken by UAE companies in India. EMAAR, a real estate company of Dubai Government, is active in the real estate sector having already set up a major township, an international convention centre and a golf course in Hyderabad. Emaar and India’s MGF Development Limited, joined together to form India’s largest FDI in real estate amounting to over half a billion dollars for projects with a capital outlay of US$4 billion (Rs.18,000 crore) and constructed flats for the Commonwealth Games (2010) Village.

Dubai Ports World is now operating 6 major Ports in India at Nhava Sheva, Navi Mumbai, Chennai, Mundra, etc, following its acquisition of the P&O of U.K. DP World constructed the International Container Transshipment Terminal (ICTT) at Vallarpadam in Kochi (Kerala). The first phase of the ICTT Project at Vallarpadam (Kochi) was inaugurated by Prime Minister on - February 11, 2011. The planned capacity at Vallarpadam, when fully expanded, is 3 million TEUs, making it the country’s largest container terminal. The DP World has recently received a letter of award from Jawaharlal Nehru Port Trust, to build and operate a single berth facility of 330 meters quay length alongside its existing terminal operation at Nhava Sheva, Mumbai.

Abu Dhabi’s National Petroleum Construction Company(NPCC), has won a major engineering and construction contract to build offshore platforms from India’s Oil and Natural Gas Corporation(ONGC). NPCC will build the WO-16 cluster and SB-14 wellhead platforms project at the offshore Mumbai High Field, valued at Dh550 million.

Ras al-Khaimah (RAK) signed a MoU for a JV with Govt. of A.P for setting up a one million tonne per annum Alumina plant and a 250,000 tonne aluminium smelter. RAKIA  has already commissioned the RAK ceramics factory located at Kakinada in AP. UAE tile manufacturer, RAK Ceramics India, has set up a tile plant in Ahmedabad, at an investment of $150 million.

Abu Dhabi National Energy Company (TAQA) has presence in India, through a company called “ST -CMS Electric Company Pvt Ltd.”, operating 250 MW lignite- fired power plant in Neyveli, Tamil Nadu. TAQA has plans to expand its power generating capacity by another 250 MW at the same site. The likely investment will be around US$250 million.

The Abu Dhabi Investment Authority (ADIA), which is a sovereign fund owned by the Abu Dhabi Government has around US$700 billion in investible funds. Most of the investments made by ADIA in India are in portfolio investments.   It owns 12% stake in the Indian Company Infrastructure Leasing & Financial Services (IL&FS).

Dubai-based private equity firm Abraaj Group has announced (in August 2013) an investment of US$17.5 million in Rainbow Hospitals in Andhra Pradesh.  Mohebi Logistics (a supply chain management company in Dubai)  is setting up a subsidiary in Pune.

Dubai-based contractor Drake and Scull International has won US$ 82.8 million contract to boost the power transmission network at Uttarakhand. The firm is building a new 400kV Double Circuit power transmission line which will be fed by a huge hydropower project known as the Uttarakhand Power Sector Investment-Project. Drake & Scull’s work will involve building 152km of transmission lines, as well as the surveying, design, fabrication and supply of 400kV DC transmission line towers.

UAE-based KEF Holdings, a multinational firm specialising in offsite construction technology, has announced the launch of operations in India with a planned investment of AED 900 million.

UAE-based Pure Gold Group stated that they would like to invest US$ 150 Million (INR 1,000 crore) in India mainly in retail, manufacturing and hospitality sectors.

Indian investments in UAE:

Though no official figures are available, according to Indian Business & Professional Council, Dubai, investments by Indian companies in UAE would be in excess of US$55 billion. Hinduja Group has set up manufacturing units for Ashok Leyland vehicles in Ras-al-Khaimah. An Aqua theme park was set up as a joint venture between Polo Amusement Park from India, RAK Investment Authority and RAK Properties. Many Indian companies have set up manufacturing units either as joint ventures or in Special Economic Zones for cement, building materials, textiles, engineering products, consumer electronics etc. Many Indian companies including Taj Group of Hotels have also invested in the tourism, hospitality, catering, health, retail and education sectors. The EMKE Group under the banner ‘Lulu‘ set up by an Indian national dominates the retail/departmental sectors in UAE. Al-Faraa group is a booming construction-sector company. Indian cement manufacturer JK Cement is investing US$14.97 mn to set up a white cement plant with a capacity to produce 0.6 million tones per year(mtpy), in Fujairah Free Trade Zone.  Indian companies like Ashok Leyland, Mahindra, Dabur etc. operate out of the business parks of Ras Al Khaimah Investment Authority. Zuari Agro Chemicals and Tata Power are also setting up units in Ras Al Khaimah ($800 mn fertilizer plant and $250mn sugar plant). India’s Essar Steel Processing and Distribution (ESPD), part of Essar Steel, has a service centre facility in Dubai (capacity: 250,000 tonnes) to cater to the needs of customers in Middle East and neighboring region. The region has traditionally been one of Apollo Tyres’s strongest export markets, accounting for about 30% of export revenues. The company has opened an office in Dubai and its distribution network in the Middle East is spanning 14 countries and 23 business partners.  India’s Infrastructure Leasing & Financial Services Limited (IL&FS) and UAE-based Prime Terminal have jointly pumped in Dh477 million ($130 million) in an oil storage terminal at Fujairah. IL&FS Prime Terminals, a joint venture formed between IL&FS Maritime Infrastructure Company Limited (IMICL) and PTF, reached an agreement on the first phase of the 632,678 cubic metres project. This will help boost the fuel storage capacity to increase from 5.08 million cubic metres to 7.95 million cubic metres.

Indian television major Zee Entertainment has invested in the satellite television network in the Middle East, with Dubai as its base. It is already running a special Arabic channel Zee Aflam  devoted to bollywood entertainment.  In September 2012, Zee announced a $100 million investment in Zee Alwan - Dubai, the second Arabic channel by Asia’s largest television provider.  Birla Institute of Technology & Science (BITS) Pilani in India opened its international campus in Dubai on December 2007 -  BITS Pilani, Dubai.  It is the one of the dedicated engineering institutions in the region and has the largest campus spread across a 15-acre plot in Dubai International Academic City with an excellent academically conducive infrastructure and highly qualified faculty. Other Educational Institutions set up by Indian entities are Manipal University, Mahatma Gandhi University, Pune University, S P Jain School of Global Management etc.

Major Indian companies such as L&T, ESSAR, Dodsal, Punj Lloyd, ElL etc. have been able to obtain significant number of contracts in the UAE.  L& T and its Oman-based subsidiary have secured major contracts in water supply projects, construction, oil, electric transmission and other sectors. In June 2011, India-based PCM Strescon Overseas Ventures Ltd (Siliguri, West Bengal) signed a contract worth US$40 million with Etihad Rail for design & manufacture of railway sleepers as well as production of sleeper manufacturing facility for Phase I of the railway network of 266 km route linking Shah, Habshan and Ruwais in the Abu Dhabi western region.  Larsen & Toubro has won two engineering, procurement and construction (EPC) contracts in the UAE worth more than $639m. L&T has successfully executed the civil & electrical part of the Abu Dhabi Khalifa Interchange Highway project (US$162 million), construction of electric transmission lines in Fujairah & offshore platforms for Abu Dhabi Marine Operating Company (ADMA-OPCO). It has also won a contract worth US$257 million for Airside construction in the Abu Dhabi Airport Midfield Terminal expansion.  Saipem, Tecnimont and Dodsal as a consortium won a contract in October 2011 worth US$900 million from Etihad Rail to carry out civil and track works that will connect the Western Region cities of Habshan and Ruwais by 2013 and Shah Habshan by 2014. Dodsal had earlier, in April 2011, signed a contract worth US$500 million with GASCO for design, engineering & construction of Habshan Sulphur Granulation Plant. Dodsal has been awarded a US$450 million EPC contract in August 2012 for constructing the Habshan-Maqta-Taweelah gas pipeline project for GASCO, to be executed in 34 months time.

There are close to 700 direct flights operating every week between various destinations in India and UAE, serviced by Air India/Air India Express, Jet Airways, Spicejet, Indigo, Emirates, Etihad, Flydubai and Air Arabia. On 24 April, an MoU was signed by the visiting MoCA delegation with the Abu Dhabi Emirate to increase the number of seats from the current 13,330 per week to 24,330 (immediately), 37,130 (Winter 2014) and 50,000 (Winter 2015) per week.  The updated Air Services Agreememt was signed on 7.1.2021 at New Delhi.

Institutional Arrangements :

A Joint Commission mechanism at the level of Foreign Ministers has held ten sessions so far, to discuss the entire gamut of bilateral relations.  The 10th Meeting of the Indo-UAE Joint Commission was held in Abu Dhabi from April 15-16, 2012. Both sides discussed various issues for promoting bilateral cooperation in the following fields: trade and investment; education, culture, youth and sports; health, science and technology, agriculture and environment; manpower; and energy, hydrocarbons, petrochemicals and fertilizers. Memorandum of Understanding on setting up a joint committee for consular affairs and a protocol to amend the India-UAE Double Taxation Avoidance Agreement (signed in April 1992) were signed during this JCM.

A Joint Business Council consisting of Federation of UAE Chambers of Commerce & Industry and Federation of Indian Chamber of Commerce & Industry (FICCI) has been set up.   Confederation of Indian Industry (CII) has signed a strategic agreement with the Khalifa Industrial Zone of Abu Dhabi (KIZAD) in October 2011 at Mumbai to support the Indian businesses investing in the new Industrial Zone. Double Taxation Avoidance Agreement (DTAA) was signed between India and UAE in April 1992.   Text of the Bilateral Investment Promotion & Protection Agreement has been agreed in October 2013 and the agreement was signed on 12.12.2020 at New Delhi.  A Customs Cooperation Agreement was signed on 1st April 2012.

Free Trade Agreement (FTA)

On the multilateral framework, India and GCC have signed a Framework Agreement on Economic Cooperation on 25th August 2004 acknowledging the growing importance of economic and commercial relations between India and GCC countries and to facilitate entering into a Free Trade Agreement (FTA). The first round of negotiations on FTA took place at Riyadh on 21-22 March 2006.  The progress has been slow since the process of integration within the GCC has been slow and there are concerns in India about providing free access to petroleum products from GCC.

NRI Remittances:

The annual remittances made by the large Indian community in UAE (estimated to be around 2.6 million) amount to over US$8 billion (Year 2012).  They had actively invested in the past in the various bonds floated by India such as Resurgent India Bonds and the India Millennium Bonds.


Bank of Baroda which is the only Indian bank holding a license from the UAE authorities for conducting full fledged banking operations, has been in operation in UAE since 1974.   BOB has one zonal office, six branches and four Customer Service Centers (CSCs) across UAE.  Similarly, Abu Dhabi Commercial Bank has two branches in India and Mashreq Bank one. Canara Bank, State Bank of Travancore and South Indian Bank manage exchange centers in UAE in collaboration with local banks. Other Indian Banks with representative offices in the UAE include Bank of India, HDFC Bank Limited, ICICI Bank Limited, Punjab National Bank, Union Bank of India, Federal Bank, Andhra Bank, Corporation Bank, Axis Bank, Indian Overseas Bank (IOB), Indusind Bank Ltd. etc.

The Dubai Financial Services Authority (DFSA), entered into a Memorandum of Understanding (MoU) with the Reserve Bank of India (RBI) on 15/6/2011 at Mumbai.  Indian banks have a significant, and growing, presence in the Dubai International Financial Centre (DIFC), so this enhancement of information sharing and assistance between the RBI and the DFSA is a critical step to ensuring confidence in each of our regulatory regimes.

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