UAE posts $599 Million trade surplus with India

Abu Dhabi: UAE's trade surplus with India rose to 2.2 billion dirhams ($599 million) in the first quarter of 2010 from a deficit of 7.3 billion dirhams in the corresponding period last year, the foreign trade ministry said in a report.

The report attributed this positive change to the big increase of 273 percent in the value of UAE's non-oil exports, up from 2.2 billion dirhams in the first quarter of 2009 to 8.4 billion dirhams in the first quarter of 2010.

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In addition, the value of India-bound re-exported UAE commodities rose by 162 percent to 11.5 billion dirhams, up from 4.4 billion dirhams in the first quarter of 2009.

The report revealed that there was an 83 percent increase in the value of non-oil foreign trade between the two nations.

The indicators reflected the strength of the existing ties between UAE and India and strength of UAE's economy and development, seen as a direct result of the implementation of the country's free market policy, it noted.

It also indicated that India is the UAE's largest trade partner, while the UAE is the number one trade partner for Indian exports, and second with regards to Indian imports, coming in second after China.

The report expects the value of commercial exchange between the two countries to increase from 108 billion dirhams in 2009 to 120 billion dirhams in 2010, especially after the signing of a framework agreement on economic cooperation between India and the GCC states in August 2005.

The report also revealed that the UAE is considered the number one Arab country, and the 10th globally in terms of the overall value of foreign direct investment inflows into India, preceded by Mauritius, Singapore, the USA, Britain, Holland, Japan, Turkey, Germany, and France.

This was based on a survey of UAE investments abroad conducted by the foreign trade ministry that showed investments by UAE firms in India reached 5.7 billion dirhams.

The report predicted that the value of UAE investments in India, in light of the continuous development of economic and commercial ties between India and the UAE, will reach 6.9 billion dirhams by the year 2011.

The report also indicated that UAE investments in India have witnessed a steady increase over the past 10 years, from $1.6 million in 2000 to $257 million in 2008, reaching $629 million in 2009.

UAE investments in India were concentrated in five main economic sectors that took a 48.6 percent share ($705 million) of the total value of these investments.

The energy sector received 19.1 percent share of UAE investments in India (worth $264 million), followed by the services sector at 9.3 percent ($143 million), programming and construction at 7.8 percent ($115 million) and 6.8 percent ($99.2 million) respectively, while tourism and hotels came in 5th place at 5.6 percent ($84 million).
Source: IANS