India and the UAE have identified food parks as one of the areas to enhance cooperation and investment between the two countries. This was discussed at the 12th meeting of the India-UAE High-Level Joint Task Force on Investments (HLJTFI) held in Mumbai on Monday (October 7, 2024).
It was co-chaired by Piyush Goyal, Minister of Commerce and Industry of India, and Sheikh Hamed bin Zayed Al Nahyan, Managing Director of Abu Dhabi Investment Authority (ADIA). The conference highlighted initiatives such as food parks, cross-border payment systems and new investment avenues, and emphasized growing economic partnership between India and the UAE.
Established in 2013, HLJTFI serves as a platform to strengthen trade, investment and economic relations between the two countries. This forum allows us to discuss potential opportunities and resolve issues facing investors from both sides. At the 12th meeting, the Co-Chairs recognized the strengthening of India-UAE bilateral relations, particularly in trade and investment, underpinned by the Comprehensive Economic Partnership Agreement (CEPA), which came into force in May 2022.
Since the implementation of CEPA, India and the UAE have experienced significant growth in trade. The agreement facilitated tariff reductions on most products and created new avenues for cooperation. In the first half of 2024, non-oil trade between the two countries increased by 9.8% from the previous year to $28.2 billion. The UAE, India’s fourth largest foreign investor as of 2023, has injected USD 3.35 billion into various sectors, tripling its investment from 2022. Meanwhile, India’s foreign direct investment (FDI) in the UAE reached USD 2.05 billion in 2023, more than India and India combined. 2021 and 2022.
New initiatives and agreements
Major initiatives discussed during the meeting include the development of food parks in India; The cooperation aims to enhance food security in the UAE while increasing incomes for Indian farmers and creating jobs in the food processing sector. Mr. Goyal stressed that a small working group involving both governments will expedite the establishment of the food corridor.
Additionally, ADIA announced plans to set up a subsidiary in Gujarat International Financial Tech City (Gift City), India’s largest international financial hub. Mr. Goyal also revealed that India plans to set up an Investment India office in the UAE. The new office, the first in the Middle East, aims to help UAE investors seize opportunities in India. “Invest India’s presence in Dubai will strengthen ties, ensure smooth communication and pave the way for further investments,” Goyal said.
A key development discussed was the integration of India’s Unified Payments Interface (UPI) with the UAE’s AANI platform, aimed at facilitating seamless cross-border transactions. The partnership, led by National Payments Corporation of India (NPCI) and Al Etihad Payments (AEP), will benefit over 3 million Indians residing in the UAE by providing efficient real-time remittance services. Become. “This collaboration will bring speed, transparency, accessibility and cost efficiency to cross-border remittances, improving convenience for millions of people,” Goyal explained.
Ratification of Bilateral Investment Treaty (BIT)
The India-UAE Bilateral Investment Treaty (BIT), signed in February 2024 during Prime Minister Narendra Modi’s visit to the UAE, was ratified and came into force on August 31, 2024. This treaty replaces the Bilateral Investment Promotion and Protection Agreement (BIPPA). The BIT ensures continued investment protection for investors in both countries, while balancing the rights of states to regulate policy matters.
The UAE is India’s seventh largest source of FDI, contributing approximately USD 19 billion from April 2000 to June 2024, with India investing USD 15.26 billion in the UAE during the same period. , BIT is expected to increase investor confidence. The main features of BITs include non-discriminatory treatment for investors, protection from expropriation, and provisions for dispute resolution through arbitration. “The BIT reflects our shared commitment to strengthening economic cooperation and creating a robust investment environment,” Goyal commented.
HLJTFI looked at the UAE’s existing investments (totaling around USD 100 billion) in India’s energy, artificial intelligence, logistics, food and agriculture sectors. Both sides expressed satisfaction at the rapid progress of ongoing projects and new initiatives such as virtual trade corridors, food parks and Bharat Mart. Bharat Mart, a major retail and warehousing project, is on track and design work is progressing rapidly.
Additionally, cooperation on central bank digital currency (CBDC) and local currency payments between the two countries was also discussed. These measures aim to further strengthen economic cooperation and reduce dependence on international currencies.
The Government of India highlighted investment opportunities in priority sectors such as renewable energy, green hydrogen, pharmaceuticals and genomics. The UAE has expressed interest in investing in India’s aerospace sector given the rapid growth of the country’s aviation market.
The 12th HLJTFI Conference concluded with both sides reaffirming their commitment to strengthening bilateral relations and economic cooperation. This forum serves as an important mechanism to discuss strategy, address challenges and explore new investment opportunities. As India and the UAE continue to strengthen their partnership, initiatives such as CEPA, BIT and payment system integration are expected to provide a solid foundation for further growth.
Mr. Goyal summarized the results of the meeting as follows. “The India-UAE partnership is built on the pillars of innovation, investment and sustainable development. Today’s joint task force meeting is critical in reviewing and advancing our common goals. We encourage all concerned to explore further avenues of cooperation.โ
Sheikh Hamed bin Zayed Al Nahyan added, “The India-UAE CEPA has been a great catalyst for strengthening economic ties.” The Joint Task Force plays a key role in removing barriers and forging new avenues for cooperation, and we are committed to achieving our common ambitions. โ
These initiatives and strategic investments will deepen economic ties between India and the UAE, benefiting businesses, economies and people of both countries.