Following a high-profile tour to the Emirate of Abu Dhabi and Dubai, during the month of February 13–14, the Indian prime minister Narendra Modi is set to sign a Bilateral Investment Treaty (BIT) with the president of United Arab Emirates (U.A.E.). His Highness Sheikh Mohammed bin Zayed Al Nahyan, bringing India as well as the UAE’s businesses closer together. Third-most populous FDI supplier within Bharat and India seventh-largest trading neighbour is the United Arab Emirates (U.A.E.).
The Indian Prime Minister’s journey to the United Arab Emirates (U.A.E.) is expected to be historic, despite the Modi administration’s secrecy on this topic. India and the United Arab Emirates (U.A.E.) have a broad trade deal that will take place during the month of February 2022.
Photo Credits: India Today
To put the bilateral agreement (BIT) in context, the United Arab Emirates (UAE) became the only nation that has a relationship with India has both, The Comprehensive Economic Partnership Agreement (CEPA) and BIT when the BJP cabinet approved the bilateral agreement on February 1st.
Even though they don’t have a BIT, the countries of South Korea, Japan, and the nation of Singapore have a Comprehensive Economic Partnership Agreement (CEPA)with India.
Apart from launching the inauguration of BAPS Hindu Temple in Abu Dhabi, establishing a Bharat Mart facilitating commerce between Indian MSMEs in the city of Dubai and being the guest speaker at the presidential conference in the Emirate of Dubai, it is also said that the Prime Minister of India, Narendra Modi has a plenty of notable events on his schedule.
Union Cabinet to approve the treaty between both the countries
Additionally, the Union Cabinet gave its approval to the United Arab Emirates (U.A.E.) and India to jointly sign and implement a Bilateral Investment Treaty (BIT).
Photo Credits : PTI
According to the governing body, the accord is anticipated to boost trust in the economy, particularly among major shareholders, leading to a rise in chances for foreign direct investments and foreign investments.
The agreement could contribute to the creation of careers, according to a statement from the governing body. The agreement would encourage cooperation within the two governments.
The statement read, “Currently, the Union Cabinet, led by the Indian Prime Minister, Narendra Modi, authorised the signing and had given approval for the mutually beneficial investment contract among the different governments in the Republic of India and the United Arab Emirates (U.A.E.)”
By promoting manufacturing locally, lowering dependency on imports, raising trade, and other means, the permission is anticipated to boost capital in India and possibly contribute to the attainment of Atmanirbhar Bharat, according to the statement. In May 2022, an agreement on free trade was also put into effect between the two countries. The Republic of India had received Foreign Direct Investments (FDI) $16.7 billion from the month of April 2000 to the end of September 2023.
The benefits of the Trade Agreement
Maharashtra, the state that contributes the most to India’s economic output, expects to benefit from the Free Trade Agreement, also known as the FTA, happening between both the United Arab Emirates (UAE) and the Republic of India. The goal of the free trade agreement (FTA), and this came into force on May 1, 2022, is to raise India-UAE trade between the two countries from sixty billion dollars to a value of $100 billion over the course of five additional years.
Photo Credits : Hindustan Times
The Free Trade Agreement (FTA) is expected to enhance not only trade but also investments between these two countries. Over thirty-five billion dollars is currently being invested in India via UAE-based businesses, with Maharashtra getting the majority of this resources. The economy of the state will grow as a result of greater investment since it is implementing novel approaches to business and innovations.
Deep commercial relations exist between the United Arab Emirates, which is abbreviated as UAE and India; in the year 2021, the worth of the UAE’s exports with India exceeded forty-five billion dollars, up eight per cent from the previous year and sixty percent from the year 2020.
With approximately 14 percent of the UAE’s overall non-oil trade globally. India also happens to be the country with which the United Arab Emirates trades the most non-oil.
