UAE aims to strengthen trade ties with India and Asean bloc
The UAE has signed a trade deal with India that is expected to boost non-oil trade between the two countries to $100bn in five years, from $60bn currently.
The Comprehensive Economic Partnership Agreement (CEPA) marks a new phase of co-operation between the two and will open additional avenues of investment and trade for companies in India and the UAE, according to government officials from both sides.
It is expected to add 1.7%, or $8.9bn, to the UAE’s gross domestic product and boost exports by 1.5% by 2030, worth $7.6bn, said Abdulla bin Touq, UAE Minister of Economy, in an online joint press conference in New Delhi.
The agreement effectively removes 80% of tariffs on goods traded between the UAE and India, with all tariffs set to be removed within 10 years, said Dr Thani Al Zeyoudi, the UAE Minister of State for Foreign Trade.
“The fact that we were able to agree the terms of a deal of this size, scope and importance within five months, demonstrates the power of our shared vision,” bin Touq said. “I am confident that the UAE-India CEPA agreement will be regarded as a towering achievement and a new era, not only for our two nations, but for global trade.”
India, Asia’s third largest economy, is already the UAE’s second-largest trading partner, accounting for 9% of the Emirates’ total foreign trade and 13% of non-oil exports.
ASEAN trade set to increase after new deals signed
The UAE is seeking to increase trade and investment with the Association of South East Asian Nations member states, having signed Comprehensive Economic Partnership Agreements with many of the countries in the bloc, according to Dr Thani Al Zeyoudi, Minister of State for Foreign Trade.
The minister was speaking during a visit to Jakarta, Indonesia, to attend the annual Asean Business and Investment Summit, which brings together leaders from the bloc’s member nations.
“As the economic centre of gravity continues to shift eastward, the UAE and Asean can form a powerful new corridor of opportunity, one that can direct capital into high-growth sectors, develop solutions in food security and energy transition, and create clusters of excellence in the industries of the future,” Al Zeyoudi said.
“Our CEPA programme, which includes completed deals with Indonesia and Cambodia, and the launch of negotiations with Thailand, Vietnam and Malaysia, underlines our confidence in these economies – and their role in delivering a new Asian future,” he said.
The UAE’s deal with Indonesia, which came into force in early September, is projected to increase the value of bilateral non-oil trade to more than $10 billion within five years, from $4.08 billion now.
The agreement also seeks to raise the value of trade in services between the nations to $630 million by 2030.
The UAE has also signed a trade deal with Cambodia, with the aim of doubling non-oil bilateral trade over the next five years, boosting trade to $1 billion from $407 million in 2022, the Ministry of Economy said.
The UAE is working towards signing 26 CEPAs as it seeks to attract more investment and diversify its economy.
The ASEAN member countries are Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam.
They represent 5.2% of the UAE’s total non-oil foreign trade in 2022, reaching $32.2 million, according to Al Zeyoudi. The non-oil trade between the UAE and the bloc rose 2% annually to reach $15.3 billion in the first half of 2023.
“The nations of South-East Asia are natural trade and investment partners for the UAE as they all share pro-growth, pro-trade agendas, and there are limitless opportunities in sectors such as agriculture, renewable energy, advanced technology, logistics and sustainable travel and tourism that can be developed,” the minister said.
