VIDEO: 5 important things you need to know about UAE-India relations
Sheikh Mohammed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, is on a three-day visit to India.
In his second visit to the South Asian nation within in a year, the Crown Prince is the chief guest of honour at India’s 68th Republic Day celebration in the country’s capital New Delhi on January 26.
Al Nahyan is the first Arab leader to be India’s chief guest after late Saudi King Abdullah Bin Abdulaziz Al Saud in 2006 and the warm welcome the Abu Dhabi Crown Prince received speaks volumes about the importance of the two countries’ relations and their mutual respect.
On Wednesday, both the countries signed 14 agreements, including a comprehensive strategic partnership. Agreements included cooperation in energy, defence industries, maritime transport, cybersecurity, shipping and transport.
Trade relations between the seven emirates of the UAE and India date back to nearly 3,000 BC. In the first half of 2016 alone, bilateral trade between the both countries accounted for $17 billion. It totalled $50bn in 2015. India is the UAE’s second largest trading partner after China.
The two countries are looking to increasing trade by 60 per cent to $100bn, reaching $368bn by 2020.
The UAE’s imports from India reached $11bn in the first half of the last year, while non-oil exports to the South Asian nation rose to $6bn during the same period.
Moreover, the UAE is the largest investor from the Middle East in India and the 11th biggest foreign investor in terms of foreign direct investments (FDIs). The total value of Emirati investments in India was estimated at $9bn in 2015.
The UAE’s first energy security deal led the raft of memoranda of understanding (MoU) signed with India during Al Nahyan’s visit.
The deal allows the Gulf OPEC country to fill nearly half of an underground crude oil storage facility at Mangalore in South India, which is part of New Delhi’s strategic reserve system. Abu Dhabi National Oil Co (ADNOC) will store approximately six million barrels of oil at the facility.
India, hedging against energy security risks as it imports most of its oil needs, is building emergency storage in underground caverns to hold 36.87 million barrels of crude, or about 10 days of its average daily oil demand in 2016.
The UAE is India’s fifth-biggest oil supplier.
Largest expatriate community in UAE
The UAE is home to 2.6m Indian passport holders. The Indian expatriate labour force constitutes nearly 30 per cent of the total population of the emirates. The biggest chunk of foreign remittance to India (38.7 per cent) comes from the UAE, which is nearly half of annual individual overseas money transfers from the latter.
During Indian Prime Minister Narendra Modi’s visit to the UAE in August 2015, both the sides agreed to set up a $75bn fund to develop India’s infrastructure. The ambitious plan still exists only on paper, however.
Many hoped it will materialise during Al Nahyan’s latest trip, but media reports suggest that there will be further delays. But once realised, the fund will be a major achievement for the UAE.
The Crown Prince’s visit comes a few days after the attacks in Afghanistan, which killed five diplomats from the UAE.
The UAE and India have decades-old strong defence ties. After Modi’s visit, a combined military exercise called Desert Eagle was resumed by the two air forces last year after an eight-year gap.
The MoU signed between the two sides will allow cooperation in defence manufacturing and technology. The agreement stipulates collaboration in studies, research, development, innovation and cooperation between public and private sector institutions of the two countries.
“The Republic of India is considered an effective regional and international force, which has a significant role in ensuring stability in the region and the world. The UAE looks forward to effective Indian contributions in tackling the challenges and dangers faced by the region and the world, finding fair solutions to the problems, crises and tensions in the Middle East, especially in light of India’s international policy, its balance and wisdom, and how it is widely accepted regionally and internationally,” says Al Nahyan.
The bond between the two nations can be summed up in the Crown Prince’s words: “The UAE considers its relationship with India a priority and views India as a linchpin of stability and security in the Asian continent.”
(With inputs from Reuters and WAM)