India, UAE aim for $100 billion trade in five years
The Comprehensive Economic Partnership Agreement (CEPA) signed on Friday between India and the United Arab Emirates (UAE) is expected to almost double bilateral trade to $100 billion in the next five years.
This is the first significant trade pact signed by the Narendra Modi-government since 2014. Negotiations were completed in just 88 days and the agreement is expected to come into effect in the first week of May.
The agreement would result in zero duty on 90 per cent of India’s exports to the UAE in value terms.
Besides, 9 per cent of the export items such as electronic goods, chemicals and petrochemicals, stone and cement will also enjoy the duty-free benefit in 5-10 years.
The pact also covers rules of origin, technical barriers to trade, dispute settlement, IPR and digital trade.
Commerce and industry minister Piyush Goyal and UAE’s minister of economy Abdulla bin Touq al-Marri signed the pact in Delhi during a bilateral meeting.
Goyal said the pact has safeguards against a sudden surge in imports and has detailed rules of origin.
The sectors that would benefit include gems and jewellery, pharmaceuticals and medical devices, education and technology start-ups.
The two sides issued a joint vision statement that outlined the future course of relations and highlighted areas of focus, including enhanced maritime cooperation and joint steps to fight terrorism .
“The FTA (free trade agreement) will result in exponential growth in India’s exports to UAE and also will open the market to other Gulf countries, as they also follow the same technical standards as applicable to UAE. This may be used as a template for similar agreements with the GCC (Gulf Co-operation Council) countries,” A Sakthivel, president, Federation of Indian Export Organisations, said.
“Several highly labour-intensive sectors would benefit and the agreement will not only boost exports in terms of value, but also create jobs,” commerce ministry officials said.
They said the zero duty on textiles is expected to lead to additional exports worth $2 billion over the next five years.