UAE: India, UAE can benefit from enhanced cooperation on energy, skills, education: Deloitte report

economy India and United Arab Emirates They can greatly benefit from free trade agreements by sharing knowledge and best practices in several areas of mutual interest, including education, energy, skills and defense. Deloitte. Both countries have implemented Comprehensive Economic Partnership Agreement (CEPA) to promote bilateral trade and investment from May 1 this year. It aims to increase trade to $100 billion in the next few years.

“Under the preferential trade agreement, both economies may benefit from sharing knowledge and best practices in several areas of mutual interest,” the report said.

It said India’s economy is heavily dependent on crude oil imports to meet its domestic demand, while current geopolitical tensions between Russia and Ukraine and shrinking supply from Iran are further affecting macroeconomic fundamentals.

“These turmoils show that India must work to reduce its energy dependence, explore alternative fuels and diversify its crude suppliers to ensure that supplies are not disrupted,” it said.

According to the report, under the India-UAE Energy Partnership, the UAE is committed to meeting India’s energy needs at competitive prices. It pledged to help the Indian economy build strategic petroleum reserves; develop the upstream and downstream petroleum sectors; conduct training and human resource development initiatives in the energy sector.

“This will help India become more self-reliant in terms of energy,” the report said, adding that the agreement will also increase employment opportunities for the Indian workforce in the Gulf and contribute to India’s remittance earnings.

It further said that the agreement plans to coordinate digital trade and e-commerce between the two countries. Collaborations may expand into upcoming areas such as fintech lending and embedded financing.

On food security, it said the UAE plans to invest $2 billion to build food parks in India to maximize crop yields and thereby ensure its food security.

It added that UAE investment opportunities are high in India, which has announced seven mega parks for the pharmaceutical industry and medical equipment in 2020.

Indian industry opportunities in the UAE exist in oil and gas, textiles, health carepharmaceuticals, real estate, construction, and gems and jewelry.

“Gold duty concessions to the UAE will reduce input costs and boost exports to the UAE. Additionally, India is competitive in jewellery manufacturing and design; both countries can add value by sharing their expertise in gems and jewellery benefit,” it added.

Likewise, industry opportunities for UAE businesses in India also exist in the chemicals, logistics and infrastructure sectors.

Jehil Thakkar, Partner, UAE Corridor Leader, Deloitte India, said the success of the treaty will depend on its effective implementation in both countries. He said the free trade agreement would give Indian companies access to large global markets and scale up rapidly.

“The ease of doing business in the UAE and the GCC (GCC) makes it an attractive proposition for Indian companies, especially start-ups. The UAE’s strong interest in nurturing Indian start-ups can be a boon for these innovation-driven disruptive companies by providing them with an ecosystem and financial support,” Thakkar said.

He added that CEPA provides opportunities for Indian startups to enter other GCC countries (Bahrain, Kuwait, Oman, Qatar and Saudi Arabia).

He added: “CEPA will support the UAE’s growing aspirations to become a world centre for trade, talent and business… It will also enhance cross-border cultural and people-to-people exchanges.”