Beyond $100bn: How India and the UAE are building deeper economic ties

Since the UAE's Comprehensive Economic Partnership Agreement (Cepa) with India came into force in 2022, the trade and economic ties between the two nations have significantly strengthened. As of the end of the 2025-2026 financial year, the combined trade between the UAE and India exceeded $100 billion, up from around $60 billion when the Cepa was established.

The Cepa has facilitated enhanced market access, reduced tariffs, simplified customs procedures, clear rules, and competition based on rules, thereby contributing to the increase in trade between the nations.

Dr Thani Al Zeyoudi, the UAE's Minister of Foreign Trade, declared during the signing of the deal that 80% of tariffs on goods exchanged between the UAE and India had been eliminated, with the remaining tariffs set to be fully removed within a decade.

Both countries aim to double their bilateral trade to $200 billion by 2032 while deepening their business and investment ties. Currently, the UAE is India's third-largest trading partner and the second-largest export destination, while India holds the position of the UAE's second-largest trading partner after China.

The trade between the UAE and India comprises petroleum products, gems and jewelry, food, textiles, chemicals, electronic goods, and engineering items. Investment has also been growing in areas such as energy, infrastructure, private equity, financial services, and real estate. Between April 2000 and March 2026, cumulative foreign direct investment from the UAE into India reached $25.59 billion, ranking the UAE as the seventh-largest overseas investor.

Several major UAE-based companies have been investing in India, including Abu Dhabi's sovereign wealth fund Mubadala Investment Company, Abu Dhabi Investment Authority, DP World, and International Holding Company. For instance, Mubadala invested $1.2 billion in Reliance Industries' digital platform and acquired a 43.5% stake in India’s Sammaan Capital, among others.

Recent investments include a $11.5 billion deal by Abu Dhabi’s International Holding Company to develop an aluminium project in partnership with the Adani Group. DP World, the Dubai-based global ports operator, recently announced plans to invest an additional $5 billion in India to bolster its integrated supply chain network, augmenting the $3 billion already invested over the past three decades.

In May, India's Prime Minister Narendra Modi visited the UAE and signed agreements, including an agreement between Indian Strategic Petroleum Reserves Limited (ISPRL) and Adnoc for storing up to 30 million barrels of UAE crude oil in India and a potential crude storage opportunity in Fujairah. Furthermore, G42, a UAE-based technology firm, agreed to establish an 8 exaflop supercomputing cluster with the Indian government, aligning with India's plans to expand its artificial intelligence sector.

UAE's objective is to diversify its global trade, as evidenced by signing 37 Comprehensive Economic Partnership Agreements, 18 of which are currently active. These agreements have led to a 26% surge in the country's non-oil foreign trade to exceed $1 trillion for the first time in 2025.