UAE Surges as India's Fourth Largest Investor, Driven by Bilateral Economic Partnership

UAE Becomes India's Fourth Largest Source of Foreign Investment

According to the latest government data, the United Arab Emirates (UAE) has emerged as India's fourth-largest source of foreign investment, witnessing a remarkable three-fold increase in FDI from 1.03 billion dollars in 2021-22 to $3.35 billion in 2022-23. This surge has propelled the UAE from the seventh position it held previously.

Key Sectors of UAE Investment in India

The UAE has made substantial investments in various sectors across India, including services, sea transport, power, and construction activities. These investments contribute to the growth and development of these sectors in India, fostering economic cooperation between the two nations.

India's Leading Investors and UAE's Growing Significance

Singapore retained its position as the largest investor in India in the fiscal year 2022-23, with investments amounting to $17.2 billion. Following Singapore, Mauritius emerged as the second-largest investor, providing investments worth $6.1 billion, while the United States secured the third position with investments of $6 billion. The UAE's rising prominence as India's fourth-largest investor highlights its growing significance in India's economic landscape.

CEPA's Role in Boosting UAE Investments

The Comprehensive Economic Partnership Agreement (CEPA), signed between India and the UAE on February 18, 2022, and implemented in May of the same year, has played a pivotal role in boosting UAE's investments in India. CEPA facilitates zero-duty access for several goods in both markets and eases norms to promote investments, fostering a conducive environment for bilateral trade and investment.

UAE's Commitment to Indian Infrastructure and Renewable Energy

In addition to the CEPA, another driving force behind UAE's FDI growth in India is its significant investment commitment. The UAE has pledged to invest $75 billion in India's infrastructure sector over time and has also committed to partnering with India in the renewable energy sector. These commitments further strengthen the economic ties between the two nations and contribute to India's sustainable development goals.

Conclusion

The UAE has witnessed substantial growth as India's fourth-largest source of foreign investment, driven by the Comprehensive Economic Partnership Agreement (CEPA) and the UAE's investment commitments. The surge in UAE's investments across sectors such as services, sea transport, power, and construction showcases the strengthening economic partnership between India and the UAE. This investment trend highlights the growing appeal of India's market and the opportunities for bilateral trade and collaboration.