Other BriefingsUAE-India CEPA, in Effect Since 2022, Touted a Success Story
The United Arab Emirates-India Comprehensive Economic Partnership Agreement (CEPA) has been hailed as a remarkable success, strengthening the enduring economic bonds between the two nations, stated UAE ambassador Abdulnasser Alshaali on May 1, which marked the two-year anniversary of the trade deal.
UAE-India CEPA – progress over two years
The CEPA has driven progress in trade, witnessing bilateral exchanges surge from US$72.9 billion (April 2021-March 2022) to US$84.5 billion (April 2022-March 2023), marking a notable year-on-year increase of 16 percent.
Major Indian export sectors have reaped significant benefits since the CEPA’s inception, with Indian gems and jewelry exports to the UAE soaring by nearly 64 percent in just two years. Additionally, critical Indian export sectors like drugs and pharmaceuticals, as well as fruit and vegetable products, have seen substantial growth, with increases of approximately 39 percent and 35 percent, respectively.
The CEPA has increased the volume of two-way non-oil trade by 19 percent between 2021 and 2023, according to the UAE foreign ministry.
Alshaali highlighted the substantial growth in bilateral trade since the inception of the significant trade agreement. Speaking at an event in India’s financial hub, Mumbai, commemorating the second anniversary of the CEPA’s enactment, he remarked, “Over the past two years, we have witnessed remarkable growth in bilateral trade, a testament to the immense potential that exists when our complementary strengths are harnessed effectively. The CEPA has not only opened new avenues for businesses to benefit from the bilateral partnership, but has also fostered deeper integration of our economies, paving the way for increased investment flows and collaboration across diverse sectors”
The CEPA, signed in February 2022 and operational since May 1, 2022, has eliminated and reduced tariffs, fostered an open trade environment, and enhanced market access for service providers. Additionally, it addresses technical barriers and provides access to government procurement opportunities.
Notably, Indian export sectors, including gems and jewelry, drugs and pharmaceuticals, and fruit and vegetable products, have experienced substantial growth, with exports to the UAE increasing significantly. Beyond trade, the CEPA has spurred investment benefits and instilled confidence within the business communities of both nations.
The UAE embassy highlighted the CEPA’s role in catalyzing transformative projects such as Bharat Mart in Dubai and significant investments by UAE entities in the Indian economy. Moreover, the establishment of the UAE-India CEPA Council underscores the commitment to strengthen economic ties further.
Looking forward, partnerships in critical industries like startups, women entrepreneurs, MSMEs, and the services sector are expected to drive the growth trajectory of the UAE-India relationship.
With UAE-India bilateral trade reaching approximately US$85 billion in 2022-23, and the UAE ranking among the top investors in India, the two countries are poised to deepen their economic engagement further. The substantial Indian expatriate community in the UAE – a population of around 3.5 million – further strengthens prospects for bilateral trade and commerce.
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