India-UAE Summit

News Highlights

Following the 48th G7 Summit in Germany, India’s Prime Minister attended India-UAE Summit

Focus Points

• According to Foreign Direct Investment data, the UAE invested more in India in 2021 than Germany and France combined.
• Unlike the UAE, none of the G7 countries has yet signed a bilateral Comprehensive Economic Partnership Agreement (CEPA) with India.

India- UAE Synergy

• The current India UAE synergy and amity are largely due to Prime Minister’s tending visit.
• This would be his fourth visit to Abu Dhabi and sixth summit with Sheikh Mohammed over the past seven years.
• The visits have plenty to show — from Emirati investments in Jammu and Kashmir to a CEPA.

Changes since the pandemic

• Bilateral trade grew by 68% in 2021-22 to $72.9 billion, a new record
• While both exports and imports grew, the trade deficit reached $16.8 billion, also a new record. 
• CEPA, the robust economic revival, higher oil prices and larger Indian imports, trade is likely to grow even higher in 2022-23. 
  • The corrective mechanism built into CEPA would, hopefully, prevent the deficit from going out of hand. 

• As the UAE collects petrodollars, India, the world’s fastest-growing major economy, could be a lucrative market for investments in areas such as petrochemicals, pharmaceuticals, renewables, infrastructure, manufacturing, logistics, start-ups, etc. 
• The two sides can collaborate for the eventual reconstruction of the war-ravaged regional countries such as Yemen, Syria, Somalia, Iraq, Libya and Afghanistan. 
• In the bilateral political domain, the two sides have cooperated efficiently on security and anti-terrorism, but they need to do more to fight money laundering and the flow of illicit narcotics

Bridging the Gulf

• The UAE is one of India’s key strategic partners among the Gulf nations and one that has stood by India even through testing times.
• On the economic front, India has pushed hard for Indians to be re-hired in order to channelise the post-Covid economic recovery plan. 
• The two sides are working to build a trained workforce by setting up a Skill India International Centre to train aspirants for jobs in Dubai in logistics, port operations and allied trades.
• During the virtual summit in February this year, both countries also signed the Comprehensive Economic Partnership Agreement, which has since entered into force, and the first consignments under that CEPA agreement have started flowing from India to the UAE and vice versa.

Controversies in UAE’s Position

• The UAE has disrupted the long standing Arab-Israel Deadlock by normalising relations with Israel in 2020 by signing Abraham Accord.
  • The two sides have recently signed a bilateral CEPA.

• After pursuing a strong regional foreign policy against the Arab nation and the regional hotspots such as Syria, Yemen Lybia, Sudan and Somalia, UAE seems determined to phase out and improve relations with Syria, Qatar and Turkey.
• The ties with Saudi Arabia remain somewhat tensed, due to policy divergences and economic competition.
• Issues with U.S
  • Similarly, UAE has developed some disturbance with the Biden presidency in the U.S. and is diversifying its strategic options with Russia and China.
  • It has conspicuously ignored the plea by the U.S. and other Western countries to raise its oil production.

India’s Bilateral Relation with the UAE?

• India and the UAE established diplomatic relations in 1972.
• The greater push has been achieved in bilateral relations when the visit of India’s Prime Minister to the UAE in August 2015 marked the beginning of a new strategic partnership between the two countries.
• January 2017: was agreed that bilateral relations were to be upgraded to a comprehensive strategic partnership.
  • This leads to the signing of India-UAE Comprehensive Economic Partnership Agreement

Pic Courtesy: The Hindu

Content Source: The Hindu