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India-UAE Free Trade deal has strengthened bilateral ties: PM Modi
Image Credit: PIB

India-UAE Free Trade deal has strengthened bilateral ties: PM Modi

| @indiablooms | 19 Feb 2023, 02:05 pm

New Delhi/UNI: Prime Minister Narendra Modi on Sunday said the India-UAE free trade agreement signed a year ago has given a fillip to Indian entrepreneurs and also deepened bilateral ties with the Gulf nation.

“CEPA with UAE has given a boost to Indian entrepreneurs and has also deepened our ties with UAE,” Prime Minister Modi said in a tweet.

The India-UAE Comprehensive Economic Partnership Agreement (CEPA) was signed on February 18, 2022 during a virtual summit between Prime Minister Modi and President of the UAE Sheikh Mohamed bin Zayed Al Nahyan.

Commerce Minister Piyush Goyal, in a tweet, said India-UAE CEPA completed one year. He also attached an article jointly written with UAE Minister of State for Foreign Trade Thani bin Ahmed Al Zeyoudi highlighting “how the deal is a turning point in our economic ties and a model for cross-border collaboration”.

On Friday, a Special Business Event was organised in Dubai by the Federation of Indian Chambers of Commerce & Industry (FICCI) in association with the Embassy of India, Abu Dhabi, Consulate General of India, Dubai and Dubai Chambers on Friday, to mark a successful year of the CEPA signing.

The event was attended by more than 200 leading businesses from India and the UAE.

UAE Minister of State for Foreign Trade Thani bin Ahmed Al Zeyoudi, speaking on the occasion, said that with CEPA, India and the UAE are offering a platform for a possible wider global cooperation.

Since the agreement was signed a year ago, UAE and India have launched several initiatives, including the I2U2 programme and a recent trilateral agreement with France to promote collaboration in energy and climate change mitigation. These partnerships create new access to economic opportunities for both countries. The I2U2 group — comprising Israel, India, the US and United Arab Emirates — is emerging as a new coalition in the Middle East.

“The CEPA deal was concluded to reflect our ambitions by reducing tariffs on more than 80 percent of product-lines and creating new opportunities for service exports and investment flows,” said Thani Al Zeyoudi at an event to mark the first anniversary of the signing of the Comprehensive Economic Partnership Agreement.

Under the agreement, duties on more than 10,000 tariff lines will be removed within 10 years.

Sunjay Sudhir, Ambassador of India in Abu Dhabi, UAE said: “It's a glorious way forward. We have figures already for the April to November 2022 period. We've already seen an increase in bilateral trade of about 30 per cent. India's exports have increased by about 19-20 per cent.

"As the awareness grows about the benefits, we're also seeing a steep rise in the number of certificates of origin being issued on both sides. This means more and more trade. As trade increases more and more awareness increases, greater numbers of exporters on both sides join in creating a lot of new opportunities.

"..Some companies have started exporting a lot of manufactured goods from the UAE to India, which they never used to do before CEPA. So, it's giving rise to new opportunities and unexplored avenues."

He added: “We’ve already seen an increase in startups. CEPA also talks about the digital world and a lot of start ups are in the digital space. In the last several months there has been a huge influx of Indian startups into Abu Dhabi and Dubai.”

“From the moment we commenced our mission, it was clear that we share the same vision, the same unity of purpose,” said Minister Thani Al Zeyoudi. “We understood that our future was better served through closer integration, greater market access, and enhanced private-sector collaboration, particularly in high-growth sectors such as advanced technology, renewable energy, logistics, food security, and many others.”

Trade between the UAE and India has increased by 10 per cent in the year after both sides agreed to the major economic treaty, setting the stage for greater co-operation throughout the Middle East and Asia.

Non-oil trade rose to nearly $50 billion since the CEPA was signed a year ago today. India’s non-oil exports to the UAE grew 5 per cent to $15.2 billion during the June-January period, compared to a 3.4 per cent contraction of such exports to the rest of the world.

Non-oil imports during the same period increased 3 per cent to $16.8 billion. India exported goods worth $285.9 billion during the June-January period, up 3.1 per cent, and exports to the UAE jumped 11.4 per cent during the same time at $20.4 billion.

“There is no better model of international cooperation than the UAE-India CEPA,” said Minister Al Zeyoudi. “And I’m looking forward to working to realize its full potential.”

On Friday, the UAE India Business Council - UAE Chapter (UIBC-UC) was launched in Dubai by UAE Minister Thani bin Ahmed Al Zeyoudi, in the presence of Indian Ambassador Sunjay Sudhir, Consul General of India in Dubai Aman Puri and founding members of the UBIC-UC.

It will operate under the supervision of the Federation of UAE Chambers of Commerce & Industry and has been registered as a legal and financial entity with the Dubai Chamber of Commerce.

Membership to the council will be by invitation only, and institutional members will be included over time.

The UIBC-UC will be the counterpart to the UIBC India Chapter, which was established in New Delhi in 2015. The council's focus will be to identify significant strategic projects that both countries can undertake, including investments in large infrastructure ventures in India, advances in manufacturing and technology, and providing Indian manufacturers with the ability to use the UAE as a base for their global expansion.

Faizal Kottikollon, Chairman of KEF Holdings, has been appointed as the Chairman of UIBC-UC, and the founding members of the council include Mubadala, Wizz Financial, DP World, Emaar, Emirates Airlines, Emirates NBD Bank, TATA, Reliance, Adani, OLA, Zerodha, Udaan, EaseMyTrip, KEF Holdings, Buimerc Corporation, Apparel Group, EFS, and Lulu Financial.

Recently, a UAE delegation came to India for the opening of Ducab’s office in Bengaluru, where it reviewed $3 billion in investments into renewable energy, logistics, retail, and food processing projects, all of which have the potential to create 20,000 jobs in India.

They follow other joint initiatives launched in 2022, such as the 300MW hybrid energy projects in Gujarat, the Dubai incubator center, and the Technology Accelerator platform set up by DP World in partnership with Invest India and the Startup Kerala mission.

On the sidelines of CEPA anniversary, LuLu Group and FICCI signed an MoU to further accelerate exports from India to UAE. According to the agreement, Lulu Group will work closely with FICCI to support and promote new Indian companies and products in UAE.

“As one of the largest retailers, currently Lulu group imports close to Dh3.5 billion worth of food & non-food products from India for our 247 hypermarkets & supermarkets in the region, and this will further grow as a result of this new MOU as well as the CEPA initiatives,” said Saifee Rupawala, CEO of LULU Group International.

Nirankar Saxena, Dy. Secretary General of FICCI said, “This MoU provides a huge opportunity to the MSMEs and start-ups in India as they reach out to UAE to expand their business.”

The CEPA entered into force on May 1, 2022. The agreement has been operating smoothly for over 10 months now.

Three sectors that have seen significant growth are the gems and jewellery sector, the agricultural sector as well as the engineering goods sector.

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