India and UAE unveil Comprehensive Economic Partnership Agreement
The negotiations for the India-UAE CEPA were concluded in a record span of 88 days
Union Minister of Commerce and Industry Piyush Goyal announced the unveiling of the Comprehensive Economic Partnership Agreement (CEPA) between India and the United Arab Emirates (UAE) at a press conference held on Sunday during his visit to the UAE.
With this, the text of the India-UAE CEPA is now available in public domain.
Goyal is in the UAE to participate in 'Investopia Summit' and 'World Government Summit' being held in Dubai.
It may be noted that the India-UAE CEPA was signed on February 18 in New Delhi during the India-UAE Virtual Summit meeting between Prime Minister of India Narendra Modi and Crown Prince of Abu Dhabi Sheikh Mohamed bin Zayed Al Nahyan.
The negotiations for India-UAE CEPA were concluded in a record span of 88 days and the agreement is expected to enter into force on May 1 this year.
According to the Ministry of Commerce & Industry, the India-UAE CEPA is the first deep and full free trade Agreement to be signed by India with any country in the past decade.
The Agreement is a comprehensive agreement, which will cover Trade in Goods, Rules of Origin, Trade in Services, Technical Barriers to Trade (TBT), Sanitary and Phytosanitary (SPS) measures, Dispute Settlement, Movement of Natural Persons, Telecom, Customs Procedures, Pharmaceutical products, Government Procurement, IPR, Investment, Digital Trade and Cooperation in other Areas.
Here are its key salient features:
* CEPA provides for an institutional mechanism to encourage and improve trade between the two countries.
* The CEPA between India and the UAE covers almost all the tariff lines dealt in by India (11,908 tariff lines) and the UAE (7581 tariff lines) respectively.
* India will benefit from preferential market access provided by the UAE on over 97 % of its tariff lines which account for 99% of Indian exports to the UAE in value terms, especially for all labour-intensive sectors such as Gems and Jewellery, Textiles, leather, footwear, sports goods, plastics, furniture, agricultural and wood products, engineering products, medical devices, and Automobiles.
* India will also be offering preferential access to the UAE on over 90% of its tariff lines, including lines of export interest to the UAE.
As regards trade in services, India has offered market access to the UAE in around 100 sub-sectors.
Indian service providers will have access to around 111 sub-sectors from the 11 broad service sectors such as ‘business services’, ‘communication services’, ‘construction and related engineering services’, ‘distribution services’, ‘educational services’, ‘environmental services’, ‘financial services’, ‘health-related and social services, ‘tourism and travel related services, ‘recreational cultural and sporting services’ and ‘transport services’.
Both sides also agreed to a separate Annex on Pharmaceuticals to facilitate access to Indian pharmaceuticals products, especially automatic registration and marketing authorization in 90 days for products meeting specified criteria.
According to the Ministry of Commerce & Industry, India and the UAE enjoy excellent bilateral relations, which are deep-rooted and historical, sustained and nurtured by close cultural and civilizational affinities, frequent high-level political interactions, and vibrant people-to-people linkages.
“The India-UAE comprehensive strategic partnership initiated during the visit of Prime Minister of India to UAE on 16-17 August 2015, is the cornerstone of our multi-faceted bilateral relations,” added Goyal.
India and the UAE have been each other’s leading trading partners. From $180 million per annum in the 1970s, India-UAE bilateral trade has steadily increased to $60 billion (₹4.55 lakh crore) in FY 2019-20 making the UAE, India's third largest trading partner.
With exports to the UAE valued at $29 billion for the year 2019-20, the UAE is also the second-largest export destination of India after the US, while Indian imports from the UAE were valued around $30 billion, including 21.83 MMT ($10.9 billion) of crude oil.
The UAE is an important source of India’s energy supply and a key partner of India in the development of strategic petroleum reserves, upstream, and downstream petroleum sectors.
India's major exports to the UAE include petroleum products, precious metals, stones, gems and jewelry, minerals, food items such as cereals, sugar, fruits and vegetables, tea, meat, seafood, textiles, engineering and machinery products, and chemicals.
India's top imports from the West Asian country are petroleum and petroleum products, precious metals, stones, gems and jewelry, minerals, chemicals, and wood and wood products.
UAE is also the eighth largest investor in India with an estimated investment of $18 billion.
Moreover, India and the UAE have recently entered into a Memorandum of Understanding (MoU) whereby the UAE has committed $75 billion towards infrastructure development in India.
In October 2021, the Government of Dubai signed an MoU with the Jammu & Kashmir administration for real estate development, industrial parks, IT towers, multipurpose towers, logistics, medical college, a super specialty hospital, and more.
The India-UAE CEPA will further enhance the already deep, close and strategic relations between the two countries and will generate new employment opportunities, raise living standards, and improve the general welfare of the peoples of the two countries.