How has the CEPA impacted trade relations between UAE and India since its implementation?
The UAE-India CEPA entered into force on May 1, 2022, unlocking an array of benefits for the two private sectors. In the first two years since the pioneering agreement came into effect, trade between the two countries has grown remarkably by 16.41 percent, with total trade growing from $72.87 billion in 2021-2022 to $84.84 billion in 2022-2023. Major Indian export sectors have witnessed considerable growth following the implementation of the CEPA, with Indian exports of gems and jewellery, drugs and pharmaceuticals and fruits and vegetables to the UAE recording significant growth. Indian FDI in the UAE is also growing, as 11,000 new Indian companies were registered in 2022, taking the total number of Indian companies operating in the UAE to more than 83,000. The two countries are on track to go beyond achieving the goal of $100 billion in non-oil trade by 2030.
Can you discuss the UAE’s strategy for fostering joint startup ecosystems with India?
Cooperation in startups and SMEs is an integral aspect of the UAE-India economic partnership. The establishment of the CEPA has strengthened this collaboration to promote startups through exchange of best practices, through strengthened relations between accelerators, incubators, and other such ecosystem stakeholders. The launch of the ‘India-UAE Startup Bridge’ brought this vision to reality. It is a one stop platform that makes information regarding the Indian and UAE startup ecosystem easily accessible to entrepreneurs and stakeholders from both sides. It aims to facilitate capacity building of incubators, incubation opportunity for startups, cooperation between investment firms in the UAE and Indian venture capital and private equity firms, and fundraising support and data needed to help startups and turn into unicorns. The initiative is a key step towards the formalization of cooperation between India and UAE on building stronger startup ecosystems in both countries through long-term programs. Enhancing partnerships with India in the startups and SMEs sector is one of the key focus areas during this visit as well.
What role does supply chain optimization play in your food security initiatives with India?
Effective supply chain management is key to ensuring food security by minimizing losses, optimizing distribution, and enhancing the resilience and efficiency of food supply chains. As geopolitics is reshaping supply chains, the strengthening of economic ties between the UAE and India is very much aligned with nearshoring and friend-shoring trends we are observing among other nations.
How does the UAE-India economic partnership fit into broader global economic trends and challenges?
The strong, multifaceted and ever-growing trade and economic partnership between the UAE and India is a model for sustainable development and productive global partnerships at a time when some players around the world are turning towards protectionism and isolationism. The UAE believes that partnerships and collaboration are the way forward for the global economy and our partnership with India contributes to addressing several challenges faced by the global economy today, including food security and climate change. It continues to create opportunities for the private sector, leading to employment creation and sustainable economic development.
Which renewable energy projects in India are currently attracting the most interest from UAE investors?
The UAE’s commitment to sustainable development is clearly demonstrated by substantial investments in renewable energy in foreign markets. In 2022, the UAE FDI outflows dedicated nearly US$ 36 billion (AED132.5 billion) to renewable energy projects. In the past 15 years, we invested more than US$40 billion (over AED 147 billion) in clean and renewable energy sources, and we plan to invest an additional US$160 billion (AED 589 billion) over the next three decades on the road to net zero. The UAE’s TAQA owns and operates a 250 MW lignite-based thermal power plant in Neyveli in the state of Tamil Nadu in India. Masdar’s investment into Hero Future Energies supports India’s goal to achieve a renewable energy power generating capacity of 175 GW by 2022, including 100 GW of solar energy. Apart from that, a consortium led by the UAE’s Mubadala and BlackRock Real Assets invested 40 billion Indian rupees (USD 525 million) in a subsidiary of India’s Tata Power to create the country’s most comprehensive renewable energy platform. Besides, earlier this year, the UAE and India signed an agreement to increase co-operation between the two countries in areas such as clean energy, electricity grid connectivity and green hydrogen.