UAE-India bilateral trade & investment opportunities
The United Arab Emirates and India, both world leaders in economy, share a long, strong history of bilateral relations. The two countries have a rich cultural exchange history and share centuries old trade ties. UAE-India bilateral trade has been consistently strengthening through investment and political cooperation.
For the UAE, India is its third largest trading partner after USA and China. Based on projections, the financial year FY 2023-23 will see trade between India and the UAE cross over USD 88 billion, which greatly surpasses FY 2021-22’s figures of USD 73 billion. In fact, the period between April & August of FY 2022-23 saw a bilateral trade of USD 36.82 billion between UAE & India.
UAE-India bilateral trade relations: Notable investments
The past couple of years has seen investments worth over 10 billion dollars come from the UAE. These include high profile investments in Reliance Jio and Reliance Retail (June 2020) worth USD 2 billion, another USD 2 billion investment in renewable energy in Adani (April 2022), and USD 1 billion in TATA motors in electric vehicles (October 2021). Reliance also invested USD 2 billion in a petrochemicals joint venture in the UAE in December 2021.
Under the I2U2 summit, UAE & India are in discussions for investments of USD 2 billion from the UAE. The purpose for that would be to develop food corridors in India plus another USD 300 million investment to build a 300-Gigawatt wind and solar (hybrid) power plant.
In February 2022, the first ever Comprehensive Economic Partnership Agreement (CEPA) between UAE & India came into place. This was a first for India in the past decade, & the agreement came into effect from May 2022.
A careful observation of the April-August period of FY 2021-22 and FY 2022-23 shows an increase of 38 per cent in bilateral trade. Also, for this period, exports saw a 27 per cent growth & imports surged by 45 per cent as a result of higher crude prices.
What attracts Indian investors to Dubai?
Both UAE as well as India share solid economic relationships. They also have a history of active trade and financial expansion. One of the key areas of cooperation is bringing investment opportunities to Dubai and other parts of the UAE. Indian investors are keen on tapping into the UAE’s markets via trending industries.
Trade & commerce
In the Middle East, Dubai is among the leading cities for trade and commerce. It attracts a fair number of Indians wanting to establish & expand their business base in the MENA region. The emirate is known for its investor friendly laws, as well as its free zones which offer ease of business setup and numerous other incentives. Dubai is home to the International Free Zone Authority (IFZA), an affordable and efficient free zone known for its ease of company registration.
Real estate investment
One sector that is highly popular is real estate investment in the UAE. The massive real estate boom over the past years is the direct impact of a growing population that is flush with capital leading to a demand for residential as well as commercial properties. Therefore, Indian investors are now able to generate rental income by purchasing properties in Dubai. UAE on the other hand, introduced long-term residency options for real estate investors as an enticement.
Tourism & service industry
Additionally, the tourism and hotel service industry are quite the backbone of Dubai’s economy. As a business opportunity, they are highly profitable and always in demand. Dubai’s popularity as a global jet-setting lifestyle destination is further augmented by its ultra-luxe, ultra uber tourism offerings. Hotels, restaurants, cafes, lounges, clubs, are top business ideas for investment.
The emirate of Dubai is ready to bring about a technological revolution. There are continuous breakthroughs in the fields of IT services, Blockchain, Artificial Intelligence, Augmented & Virtual Reality, Robotics, Digitalisation & more. The emerging start-up scene in Dubai will get a further boost through initiatives like the Dubai Future Accelerators program. There is room for Indian investors to directly invest in these start-ups or form their own technology company in the UAE.
UAE-India Bilateral Trade: Summary
India as well as the United Arab Emirates have signed several trade agreements and Memorandum of Understandings (MoUs) with the aim of increasing cooperation in trade, investment & technology.
The formation of the India-UAE Joint Investment Fund is primarily based on the mission of generating funding for joint ventures. It is backed by the governments of both nations and the board of directors include both Indians and UAE nationals.
The 2019 India-UAE High Level Task Force on Investments is also a good reflection of the increasing cooperation between the two nations. Representatives of both countries come together to chalk out potential investment opportunities in both markets, and vision out how to support & assist emerging businesses from India & UAE.
Shuraa makes investing in the UAE easy
The UAE has a very strong expatriate population, comprising of around 88.52 per cent of the total population. Out of this, Indian expats hold the highest numbers of roughly 30 per cent, i.e., around 3.5 million. Sectors such as IT services, business, professional services & construction are the most popular choices for investing by Indians.
Dubai is the top choice for investment from India with Abu Dhabi a solid second. Shuraa Business Setup, UAE’s leading company formation expert, assists investors with end-to-end corporate solutions to make their Dubai journey easier. Shuraa in collaboration with IFZA will soon be hosting India’s first ever interactive event where investors across the country can connect to UAE’s top free zone professionals. The Shuraa x IFZA Co-Lab will have industry experts like Mr. Saeed Khalifa al Fuqaei, Founder & Chairman, Shuraa Group, Mr. Shahid Rather, Managing Partner, Shuraa Group, Mr. Azil Nazeem, Client Engagement Manager, IFZA and several other significant delegates.
When: 5th March, 2023; 10:00 AM onwards
Where: Dezire Hall, Le Meridian Hotel, Connaught place
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