India-UAE Trade Surges to $83.7 Billion in Two Years Post CEPA Implementation
The India-United Arab Emirates (UAE) Comprehensive Economic Partnership Agreement (CEPA), which was signed on February 18, 2022, has considerably increased bilateral trade, almost doubling from $43.3 billion in FY 2020-21 to $83.7 billion in 2023-24, as per the Commerce and Industry Ministry.
In the first nine months of FY 2023-24 (April-December), two countries' trade crossed $71.8 billion. Importantly, smartphones turned out to be a leading export commodity with $2.57 billion worth of exports to the UAE. CEPA, a far-reaching pact dealing with numerous sectors, was signed in a virtual summit by Prime Minister Narendra Modi and UAE President Sheikh Mohamed bin Zayed Al Nahyan and took effect from May 1, 2022.
The pact has promoted diversification in trade, with non-oil trade amounting to $57.8 billion in FY 2023-24, accounting for more than half of the overall trade volume. This is in line with the long-term goal of reaching $100 billion in bilateral non-oil trade by 2030. Since the implementation of CEPA, around 2,40,000 certificates of origin have been issued, enabling exports worth $19.87 billion to the UAE. India's non-oil exports reached $27.4 billion in FY 2023-24, representing an average annual growth of 25.6%.
The major export industries that have gained from CEPA are refined crude oil products, gems and jewellery, electrical machinery, boilers, generators, reactors, and organic and inorganic chemicals. Closer cooperation has been promoted through the agreement, with both governments working on trade-related issues through frequent high-level meetings and technical consultations.
The Joint Committee responsible for monitoring the implementation of CEPA has met twice at the Joint and Additional Secretary levels. The Trade in Goods Committee too has met on several occasions to settle trade disputes. In addition, several sub-committees have been established to discuss trade in services, rules of origin, customs procedures, and trade facilitation.
A significant step in strengthening trade relations is the launch of the Bharat Mart initiative in Dubai by PM Modi. This platform aims to serve as a hub for Indian manufacturers, enabling them to showcase their products to global markets and further boost exports.
The India-UAE CEPA has opened a new era of economic cooperation, empowering MSMEs, creating jobs, and opening new business opportunities. Both countries are committed to using CEPA to increase trade and economic opportunities, solidifying their historic strategic partnership.
