India, UAE Discuss Defence, LNG, Aim for $200 Billion Trade

PM Modi and UAE President discuss defense cooperation, LNG, and trade targets.

Photo by Matias Luge

Prime Minister Modi met with the UAE President today to discuss strengthening bilateral relations. Key areas of focus included deepening defense cooperation, expanding LNG partnerships, and setting an ambitious target of $200 billion in trade. The meeting underscores the strategic importance of the India-UAE relationship in the current geopolitical landscape. Discussions also touched upon regional security and stability, with both leaders reaffirming their commitment to combating terrorism and promoting peace.

Key Facts

Trade target: $200 billion

Focus areas: Defence, LNG, trade

Discussions: Regional security

UPSC Exam Angles

GS Paper II: Bilateral Relations

International Agreements and their impact

India's Foreign Policy

Visual Insights

India-UAE Strategic Partnership

Map showing the locations of India and the UAE, highlighting key areas of cooperation such as trade routes, LNG infrastructure, and defense cooperation zones.

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📍India📍UAE📍Arabian Sea

India-UAE Bilateral Trade Statistics

Key statistics highlighting the economic relationship between India and the UAE, including current trade volume and the targeted trade volume.

Current Bilateral Trade: $85 Billion
Targeted Bilateral Trade: $200 Billion
India's LNG Imports from UAE: 25% of total LNG imports

More Information

Background

The India-UAE relationship has deep historical roots, tracing back to ancient maritime trade routes. For centuries, merchants from the Indian subcontinent have traded with the Arabian Peninsula, fostering cultural and economic exchanges. The modern relationship was formalized with diplomatic ties established in 1972, shortly after the formation of the UAE.

Initially focused on trade and labor migration, the relationship has evolved significantly. The large Indian expatriate community in the UAE has played a crucial role in strengthening these ties, contributing significantly to the UAE's economy and serving as a bridge between the two nations. Over time, the relationship has expanded to include cooperation in areas such as security, counter-terrorism, and energy.

Latest Developments

In recent years, the India-UAE relationship has witnessed a significant upswing, particularly since 2014. High-level visits and strategic dialogues have become more frequent, reflecting the growing importance of the partnership. A Comprehensive Strategic Partnership was established in 2017, providing a framework for enhanced cooperation across various sectors.

The Comprehensive Economic Partnership Agreement (CEPA), signed in 2022, is a landmark achievement, aiming to boost trade and investment flows. Looking ahead, both countries are exploring opportunities for collaboration in emerging areas such as renewable energy, space exploration, and digital technology. The focus is on diversifying the partnership beyond traditional sectors and building a future-oriented relationship.

Practice Questions (MCQs)

1. Consider the following statements regarding the India-UAE Comprehensive Economic Partnership Agreement (CEPA): 1. It aims to eliminate tariffs on a majority of goods traded between the two countries. 2. It includes provisions for enhanced cooperation in the services sector. 3. It is India's first CEPA with a country in the MENA (Middle East and North Africa) region. Which of the statements given above is/are correct?

A.1 and 2 only
B.2 and 3 only
C.1 and 3 only
D.1, 2 and 3

Show Answer

Answer: A

Statements 1 and 2 are correct. While the CEPA is significant for the MENA region, it is not India's first CEPA with a country in the region. India has prior agreements with countries like Israel.

2. With reference to the historical trade relations between India and the UAE, consider the following statements: 1. The Silk Route was the primary trade route connecting the two regions during ancient times. 2. The port of Lothal in the Indus Valley Civilization had maritime links with the Arabian Peninsula. 3. The use of Dhows, traditional sailing vessels, facilitated trade across the Arabian Sea. Which of the statements given above is/are correct?

A.1 and 2 only
B.2 and 3 only
C.1 and 3 only
D.1, 2 and 3

Show Answer

Answer: B

Statements 2 and 3 are correct. The Silk Route primarily connected East Asia with Europe, not directly India and the Arabian Peninsula. Maritime trade through the Arabian Sea was crucial, with Lothal being a key port.

3. Which of the following statements accurately reflects a key aspect of the Indian diaspora in the UAE? A) The majority of Indian expatriates in the UAE are employed in the agricultural sector. B) Remittances from Indian workers in the UAE significantly contribute to India's foreign exchange reserves. C) The Indian diaspora in the UAE has limited cultural influence due to strict local customs. D) Most Indian expatriates in the UAE are permanent residents with citizenship rights.

Show Answer

Answer: B

Remittances from Indian workers in the UAE are a significant source of foreign exchange for India. The other options are incorrect as most are employed in various sectors, the diaspora has a considerable cultural influence, and most are not permanent residents with citizenship.