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In 2022 FDI from the UAE into India witnessed a significant surge, reaching Dh56.5 billion.

by Swati Gupta

May 31, 2023 23

Foreign direct investment (FDI) from the United Arab Emirates (UAE) to India reached an impressive total of Dh56.5 billion by the end of 2022, as both nations intensify their efforts to enhance investment mechanisms and explore opportunities in new sectors. This announcement was made by Abdulla bin Touq Al Mari, the UAE Minister of Economy, highlighting the commitment of both countries to deepen their economic ties and foster mutual growth.

The FDI from the UAE to India primarily focused on key sectors such as renewable energy, telecommunications, roads infrastructure, real estate, and start-ups. These investments reflect the UAE’s confidence in India’s potential and its willingness to contribute to the country’s economic development. Additionally, Indian FDI in the UAE saw a substantial increase, reaching Dh30 billion in 2020. This reciprocal investment trend further strengthens the bilateral relationship between the two nations.

The UAE Minister emphasized that the relationship between the UAE and India has evolved into an exceptional model of bilateral cooperation and a fruitful partnership. Both countries are committed to promoting sustainable development, economic welfare, and the steady prosperity of their respective populations. This shared vision has laid the foundation for deeper economic integration and mutual benefit.

The significant influx of FDI from the UAE into India underscores the confidence and trust that investors from the UAE have in the Indian market. The investments in renewable energy align with India’s ambitious goals of expanding its clean energy capacity and reducing its carbon footprint. By supporting the development of renewable energy projects, the UAE contributes to India’s efforts to transition to a more sustainable and environmentally friendly future.

Additionally, the investments in telecommunications, roads infrastructure, real estate, and start-ups demonstrate the UAE’s interest in various sectors of the Indian economy. These investments not only provide financial support but also foster knowledge transfer and exchange of expertise between the two nations.

In parallel, Indian FDI in the UAE has also experienced significant growth, reaching Dh30 billion in 2020. This highlights the mutually beneficial nature of the UAE-India investment relationship. Indian businesses have found opportunities to expand and diversify their operations in the UAE, capitalizing on the country’s strategic location, business-friendly environment, and well-developed infrastructure.

The UAE and India share a deep-rooted commitment to promoting trade and investment, which has been further strengthened by ongoing efforts to establish mechanisms that facilitate and encourage mutual investments. The establishment of frameworks such as the UAE-India High-Level Task Force on Investments and the UAE-India Infrastructure Investment Fund has created platforms for enhanced collaboration and streamlined investment processes.

The close ties between the UAE and India extend beyond economic cooperation. The two nations have a history of cultural exchange, people-to-people interactions, and strategic partnerships. This comprehensive approach has contributed to a robust and multifaceted relationship that encompasses economic, social, and diplomatic dimensions.

Looking ahead, both countries are poised to further enhance their economic partnership and explore new avenues of collaboration. Initiatives such as the UAE’s focus on emerging technologies and India’s emphasis on innovation and digital transformation present opportunities for synergies and joint ventures.