Context:

• Prime Minister Narendra Modi is scheduled to pay an official visit to the United Arab Emirates (UAE).
• This is PM’s seventh visit to the UAE since 2015 and the third in the last eight months. 
• In this short duration, India’s relationship with UAE has evolved into becoming one of the most prominent bilateral relationships for New Delhi. 

Pillars of Relationship:

• Climate Initiatives: The convergence of ideas on global climate issues too was clear when Mr. Modi was in Dubai for the COP28 climate summit. 
  • Both India and the UAE co-launched the Global Green Credit Initiative. Apart from this initiative, the countries have cooperated through International Solar Alliance, Joint Working Group on Renewable Energy.
• Economic and Trade Relations: Bilateral trade grew to $85 billion in 2022-23, making the UAE India’s third-largest trading partner and India’s second-largest export destination. The UAE is also the fourth-largest overall investor in India. 
  • The India-UAE Comprehensive Economic Partnership Agreement(CEPA), signed on February 18, 2022 in a record time of 88 days, aims to increase trade in services to $115 billion in five years. 
  • On February 1, 2024, the Indian government also approved the signing and ratification of a bilateral investment treaty with the UAE, which would significantly boost bilateral economic engagement, especially manufacturing and foreign direct investment. 
  • Fintech is yet another area of mutual convergence. The RuPay card, a key component of India’s Digital Public Infrastructure (DPI), has been accepted in the UAE since August 2019, while from July 2023, the rupee was being accepted for transactions at Dubai’s airports. 
  • India and the UAE also operationalised a rupee-dirham settlement system when, in August 2023, the Indian Oil Corporation made a rupee payment to the Abu Dhabi National Oil Company for crude oil imports.
• Energy security: The UAE is also India’s trusted partner in energy security, being the only nation from the region which has strategic oil reserves stored in India. 
  • An agreement was signed in Indian Strategic Petroleum Reserves Ltd (ISPRL) and the Abu Dhabi National Oil Company to to invest in the strategic crude oil storage facility in Mangaluru with an initial investment of $400 million.
• Diplomatic relations and Mutual Recognitions: Both countries have often gone out of their way to make exceptions for each other. 
  • When the UAE hosted the Organisation of Islamic Countries(OIC) Foreign Ministers’ meeting in 2019, it invited India’s External Affairs Minister (the late) Sushma Swaraj as a keynote speaker/guest of honour despite protests from some nations, including Pakistan. 
  • During his visit to the UAE in August 2019, Mr. Modi was conferred the UAE’s top civilian honour, the Order of Zayed. 
  • Sheikh Mohammed Bin Zayed Al Nahyan (Crown Prince of Abu Dhabi and the Deputy Supreme Commander of the UAE armed forces) was the chief guest at the Republic Day parade in Delhi in January 2017. 
  • The UAE was one of few nations specially invited for the G-20 summit, in September 2023, under India’s G-20 presidency. 
• Strategic Relations: Both countries are in close coordination and a part of a number of important groupings such as the I2U2 or the West Asian Quad comprising India, Israel, the United States and the UAE. 
  • The UAE is also part of the India-Middle East-Europe Economic Corridor (IMEEC) infrastructure project that was signed during the G-20 summit in Delhi. The corridor aims to connect India to Europe across the Arabian peninsula, and is a potential rival to China’s Belt and Road Initiative. 
• India’s close relations with the UAE ensures India to navigate the regional rivalries and maintain a working relationship with different parties in the region.
  • Eg: Saudi Arabia-Iran; Israel-Arab nations, etc.

Over the years, the relations between the countries have grown stronger on a comprehensive ground covering various aspects. While India recognises and values the UAE’s role in the region, the UAE too is cognisant of the ‘global leadership’ role that India is set to acquire. Both countries recognise that this privileged strategic partnership is only set to grow stronger in the years ahead.