Strengthening bonds: UAE and India’s economic ties and future partnership

In the ever-evolving landscape of international diplomacy and economic cooperation, few partnerships have shown as much promise and potential as that between the UAE and India.

These two nations, with rich histories and vibrant cultures, have forged a strong bond over the years. Today, they stand at the cusp of a new era of economic collaboration, poised to benefit not only their own economies but also the global stage.

Thriving trade and extension into the BRICS bloc

Strengthening its trade relationship has been at the crux on the UAE-India partnership, which will be further cemented in the recent agreement to expand BRICS bloc of developing nations. The UAE will join Brazil, Russia, India, China and South Africa and many have seen this change as a push to reshuffle a world order to level the global playing field.

The trade connection has historic roots between the two countries, dating back centuries to the time when merchants and sailors from the Indian subcontinent frequented the shores of what is now the UAE. Fast forward to today, and the UAE has become India's third-largest trading partner.

UAE has emerged as India’s third largest partner , while India is UAE’s second largest trading partner, with bilateral trade exceeding $84.5 billion in 2022-23 . Key commodities in this trade include crude oil, precious metals, chemicals, and machinery.

This trade relationship is poised for further growth with the recent agreement to trade in rupees. This groundbreaking development simplifies trade processes, reduces currency exchange costs, and fosters stronger economic ties between the two nations.

Diversified economies and sector-specific collaboration

These connections have grown stronger over time, reinforced by the presence of over 3 million Indian expatriates in the UAE, who contribute significantly to both countries' economies through remittances and their roles in various sectors, including finance, healthcare, and technology.

Both countries understand the importance of diversifying their economies to ensure sustainable growth. To leverage this mutually they have identified specific sectors for strategic cooperations which include: renewable energy, infrastructure development, tourism, pharmaceuticals, and technology.

Looking ahead, the UAE and India are set to embark on several exciting projects that will further bolster their economic partnership. One such project is the Abu Dhabi National Oil Company's (ADNOC) investment in India's strategic petroleum reserves, ensuring a steady supply of crude oil. Additionally, collaborations in the field of defense, space exploration, and healthcare are on the horizon.

Overall, the UAE and India are ushering in a new era of economic collaboration, bolstered by their historical ties, burgeoning trade relationships, and strategic investments. As they embark on ambitious projects and deepen diplomatic ties, the UAE and India serve as a beacon of international cooperation and economic progress, demonstrating the power of nations working together for mutual prosperity and global betterment.