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India - UAE Deepening Relationship (22 August 2020)

India - UAE Deepening Relationship (22 August 2020)

Why in News:

India on Monday sought investments from the United Arab Emirates in key sectors like infrastructure, highways, ports, airports, renewable energy and defence as the two sides discussed a joint strategy to offset the economic impact of the Covid-19 pandemic.


The matters came up during a virtual meeting of the India-UAE joint commission on trade, economic and technical cooperation, which was co-chaired by external affairs minister S Jaishankar and his UAE counterpart Sheikh Abdullah Bin Zayed Al Nahyan. The two sides assessed their cooperation over the past few months in the fight against Covid-19 and discussed a joint strategy to offset the economic and social impact of the pandemic on both countries.


Both countries enjoy strong bonds of friendship based on age-old cultural, religious and economic ties.

UAE is the second largest export destination of Indian Goods and Services.

UAE is one of the important crude oil suppliers to India and important for India’s energy security.

Around 3.4 million Indians are living harmoniously in the UAE.

 It is also largest population of Indian expatriates anywhere in the world.

Summary of the Debate

Key Takeaways from the Meeting:

  • Both the countries reviewed the continuing growth of their broad-based cooperation
  • Both sides agreed to strengthen cooperation in ongoing areas and to explore cooperation in newer areas reflecting the changing times.
  • They also discussed on regional issues related to their neighbourhood and cooperation at the UN and other multilateral forums.
  • Both countries agreed to hold the next session of the joint commission in Abu Dhabi in 2021.
  • India thanks the UAE for taking care of the Indian nationals during the covid pandemic.

India-UAE Relationships:


  • PM Modi ofter speaks with Sheikh Mohammed bin Zayed, Dr. Shankar Often speaks with Sheik Abdullah as the foreign minister and there is actually a high degree of cooperation at that level between the leaders .
  • UAE went to support India on issues that mattered to India out of their way to extend an invitation to Mrs Sushma Swaraj to be the guest of honor at an OIC (The Organisation of Islamic Cooperation) foreign ministers meeting in Abu Dhabi.
  • When India abrogated Article 370, UAE became the first Arab country to say, this is India’s internal business.
  • At a time when Pakistan was creating a campaign against India, UAE awarded their country’s highest civilian award to Indian PM Modi.


  • India-UAE trade, valued at US$ 180 million per annum in the 1970s, is today around?US$ 60 billion making the UAE India’s third largest trading partner for the year 2018-19 after China and the US.?
  • India is the second largest trading partner to the UAE, for the year 2018 with an amount of around US$ 36 billion (non-oil trade).
  • Out of $ 77 billion- $ 78 billion of remittances that India received last year, $ 19 billion came from UAE.

Food Security:

  • One of the most interesting things that is happening is the efforts to create India-UAE Food Corridor. There are major investment proposals that involve procurement, logistics, warehouses and cold storage chains, it potentially involves fisheries and poultry.
  • Last year total food export to UAE was about $ 2.5 billion.


  • Amongst the top five countries around the world in terms of intelligence sharing, cooperation, pre-emptive actions, sending back the bad guys like Farooq Takla, who was an aid of Dawood Ibrahim, cracking down on Jihadi groups which may have affiliations in India, all of that that does not make it to the media happens quietly behind the scenes and very effectively.
  • UAE had promised to buy weapons from India.


  • India’ first strategic petroleum reserve in Mangalore was set up with oil from Abu Dhabi National Oil Company, the second one probably be in the same.
  • There is an agreement between the Abu Dhabi National Oil Company (ADNOC) and the Saudi Aramco to set up a $ 50 billion west coast oil refinery with half the investment coming from them and half the oil coming from them.


Way Forward:

  • The goods trade between India-UAE is very prominent, the $ 60 billion US dollar of bilateral total trade is goods, but there is various area of services where already both countries have linkages but can be augmented more.
  • Education is one area which is very critical as far as putting up the system in place and especially now with unfolding of online education, so using the online platform in education and linkages across think tank and not only the scholastic classroom kind of teaching.
  • Joint collaboration in research in different fields both scientific and social sciences.
  • Health services trade is also contributing to the diversification of bilateral trade.
  • One difficulties continues to be the inability to get what is effectively a huge amount of finance from Abu Dhabi into the long term investments of the Indian economy, this means infrastructure, powers, railway, sports, etc. So, these are some areas where India really need to develop.
  • There is need to recognise each other’s contributions through awards, media, etc.

Important points made by the Guests

Navdeep Singh Suri, Former Ambassador

  • Joint Commission is the annual mechanism at the foreign minister’s level that gives both sides the opportunity to review the entire gamut of the bilateral relationship.
  • It has different working groups on areas like defence and security and trade and investment and so on.
  • In addition to the joint commission, there is various other elements in the architecture of relationship between both the countries, for example; a high level task force on investment which is headed by Commerce and Industry Minister Piyush Goyal from Indian side and from the UAE side by the Managing Director of the Abu Dhabi Investment Authority.
  • The Abu Dhabi Investment Authority (ADIA) is the world’s second largest sovereign wealth fund with assets of $ 850 billion to $ 900 billion and there is Mubadala, which is also a very large sovereign fund with the assets of $ 250 billion.
  • So, UAE have huge capacity to invest and they have been investing. During the 2017 visit of crown prince of Abu Dhabi in India as a chief guest on Republic day, there was an announcement that UAE would invest $ 75 billion into India.
  • One of the things that really have been a challenge for India is how to translate those intentions into reality because it’s not a loan it’s not a grant it’s an investment and investment needs fungible projects where an investor can put money and expect a decent return.
  • ADIA, became the first investor into India’s National Infrastructure Investment Fund, they put billion dollars into it. They put significant money into renewable energy into highways into financial assets and so on.
  • ADIA has committed to invest $ 500 million into the Mumbai and Navi Mumbai Airport and that has been driving through the legal processes for last two years and it can be quite frustrating for an investors because from India’s perspective that large chunky investment from a sovereign fund which is long term patient money is the kind of investment country want.
  • There are 3.4 million Indians in UAE in a country of less than 10 million that is over a third of the country’s population.

 Pramit Pal Chaudhuri, Foreign Editor, Hindustan Times  

  • UAE recognize that their earlier strategic investments in Pakistan are essentially a waste of time; they are concerned that the USA is leaving the Middle East bit by bit.
  • Their sense that their future of what they want to see in the UAE economy whether it’s moving away from their dependence on Oil, moving into technology, becoming a bigger financial centre than they already are, tying up with the India makes perfect sense, the obvious external prayer to bring into that future perspective.
  • They have looked upon bringing more external players, who can help their overall strategy of trying to stabilize the middle east and maintain a degree of peace and ensure that the economy in that region work together.
  • UAE positioning itself overall as trying to be the great stabiilizer of the Persian Gulf and India is a good external player to bring into the picture.

Ram Upendra Das, Head, Centre for Regional Trade, Commerce Ministry

  • UAE is always in the top three trade partners of India and this is one area where India had enjoyed trade surplus until very recently and the trade is much more balanced now. It has risen from around $ 40 billion to $ 60 billion in 2018.
  • UAE is relatively capital rich or capital surplus country and here India has emerged as an important FDI host especially given the ease of doing business and other parameters improving for India.


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