E-Paper
Sign In
UAE-India partnership enters a new phase of growth and strategic cooperation
Energy security, investment flows and advanced technology collaborations drive the next chapter of bilateral relations
- PUBLISHED: Tue 18 Aug 2026, 1:00 PM
The UAE and India are strengthening one of the world's most dynamic economic partnerships, with bilateral trade, investment and strategic cooperation reaching new highs following the implementation of the Comprehensive Economic Partnership Agreement (CEPA) in 2022.
The landmark trade pact has accelerated economic engagement between the two countries, helping bilateral trade surpass $101.25 billion in financial year 2025-26. Building on this momentum, both nations have set an ambitious target of increasing bilateral trade to $200 billion by 2032, reinforcing the UAE's position as India’s second-largest trading partner and a key gateway to global markets.
Recommended For You
A major boost to the relationship came during Prime Minister Narendra Modi's visit to the UAE in May 2026, when both countries signed a series of strategic agreements spanning energy, technology, infrastructure and investment.
Among the key outcomes was a memorandum of understanding between Indian Strategic Petroleum Reserves Limited (ISPRL) and Adnoc for the storage of up to 30 million barrels of UAE crude oil in India, while also exploring opportunities for storing Indian crude reserves in Fujairah. The two sides further enhanced energy cooperation through a long-term LPG supply agreement between Indian Oil Corporation (IOCL) and Adnoc Gas.
In a significant technology initiative, India's Centre for Development of Advanced Computing (C-DAC) and UAE-based G42 agreed to collaborate on establishing an 8-exaflop supercomputing cluster under AI Mission India, highlighting the growing importance of artificial intelligence and advanced digital infrastructure in bilateral cooperation.
Maritime collaboration also received a boost through a partnership between Cochin Shipyard Limited and Drydocks World to develop a ship repair cluster at Vadinar, supporting India's ambitions to emerge as a leading global maritime hub.
The visit generated substantial investment commitments from leading UAE institutions. Abu Dhabi Investment Authority (Adia) pledged $1 billion alongside India's National Infrastructure and Investment Fund (NIIF) for priority infrastructure projects. Emirates NBD announced a $3 billion investment in RBL Bank, while International Holding Company (IHC) committed $1 billion to Sammaan Capital.
Beyond trade, investment ties continue to deepen, with cumulative UAE investments in India exceeding $25 billion across infrastructure, renewable energy, logistics, real estate, technology and financial services. Sovereign wealth funds and major Emirati corporations are expanding their footprint in India, while Indian businesses increasingly view the UAE as a strategic hub for accessing markets across the Middle East, Africa and Europe.
Energy remains a cornerstone of the relationship, but cooperation is rapidly expanding into emerging sectors including digital payments, fintech, artificial intelligence, advanced manufacturing, food security, space technology and logistics.
Supported by a vibrant Indian diaspora and strong government-to-government engagement, the UAE-India economic partnership is expected to play an increasingly important role in shaping trade and investment flows across the broader Asia-Middle East economic corridor.
Strengthening Bilateral Ties
Rishi Chawla, Chairman of ICAI Dubai Chapter, shed explained how have UAE-India trade and investment relations evolved over the past 10 years and said both the nations have strengthered their bilateral relations.
A decade ago, he said conversations around UAE–India economic relations were largely centred on energy and traditional trade. “Today, when I meet entrepreneurs, investors or finance leaders, the discussion is very different. It is about AI, fintech, logistics, manufacturing, renewable energy, food security and global capability centres.”
“What has impressed me most is not just the growth in numbers, but the quality of that growth. The signing of the CEPA in 2022 gave businesses the confidence to think bigger and invest for the long term. Bilateral trade has now crossed the $100 billion mark, making the UAE one of India's most important economic partners, while India continues to be among the UAE's largest trading partners,” Chawla told Khaleej Times.
“As Chartered Accountants, we have had the opportunity to witness this transformation closely. As economic ties between the UAE and India have strengthened, we have seen businesses become more confident in expanding across borders, investing for the long term and adopting stronger governance and financial practices. That is a clear reflection of how this partnership has matured over the years,” he said.
Naveen Sharma, Co-Founder and Chairman, Taxation Society, said over the past decade, the UAE–India relationship has developed from a largely energy- and trade-led partnership into a broad and deeply integrated economic alliance.
“Energy remains an important foundation, but cooperation now extends across infrastructure, logistics, manufacturing, technology, financial services, food security and renewable energy.”
He said the most significant change is the institutional depth of the relationship. Stronger trade frameworks, investment protections, digital payment initiatives and closer business-to-business engagement have created greater confidence for companies and investors on both sides.
“Today, the UAE is not only an important market for Indian businesses, but also a strategic gateway to the Middle East, Africa and Europe. At the same time, India offers UAE investors access to a large, rapidly developing economy with strong opportunities in infrastructure, technology, manufacturing and consumer-driven sectors.
“The partnership is increasingly defined by complementary strengths. Together, these strengths are creating a relationship that is broader, more resilient and more future-focused than ever before,” he said.
New Growth Drivers
Sharma opined that the next phase of UAE–India economic cooperation will be driven by the ability of both countries to convert strong policy frameworks into practical commercial opportunities.
“Digital trade and connected payment systems can make cross-border transactions faster, simpler and more accessible, particularly for small and medium-sized businesses. Greater use of technology in customs, logistics, documentation and settlement can reduce friction and allow companies to participate more efficiently in bilateral trade,” he said.
Green energy will also become an increasingly important pillar of the partnership. Both countries have significant ambitions in renewable energy, clean technology, energy storage, sustainable finance and lower-carbon industrial development. Their complementary capabilities can support joint investments and long-term projects that strengthen both energy security and sustainability.
He said food security offers another natural area of cooperation. “India has strong agricultural and food-processing capabilities, while the UAE has advanced logistics, warehousing, investment capacity and access to regional markets. A more integrated food corridor can create reliable supply chains while opening new opportunities for farmers, processors, distributors and investors.”
Emerging technologies such as artificial intelligence, fintech, advanced manufacturing, space technology and digital infrastructure can give the partnership an entirely new dimension. “The next five years are likely to be shaped not only by the movement of goods and capital, but also by the movement of ideas, data, skills and innovation.”
Looking ahead to the next five years, Chawla said digital trade, green energy and emerging technologies are expected to shape bilateral growth.
“I believe the next five years will be about creating stronger economic partnerships rather than simply increasing trade. India and the UAE have highly complementary strengths. India is emerging as a global leader in technology, innovation and skilled talent, while the UAE is setting global benchmarks in AI adoption, digital infrastructure and ease of doing business. Together, this creates an ideal platform for businesses to innovate, invest and grow,” he said.
“I also see significant opportunities beyond technology. Food security is one of the most promising areas of collaboration. The UAE is making remarkable investments to strengthen local food production and build a more resilient food ecosystem. India's experience in large-scale agriculture, food processing, agri-technology and supply chain management can complement these efforts, creating innovative and sustainable solutions for the future,” he added.
Similarly, he said India's manufacturing capabilities, combined with the UAE's world-class ports, logistics network and strategic location, can help create a strong regional manufacturing and export hub serving the Middle East, Africa and Europe. As both countries continue to focus on sustainability and clean energy, there is also tremendous potential to collaborate on technologies and industries that support long-term economic growth while reducing environmental impact.
“The UAE–India relationship has already moved beyond a buyer-seller relationship. I believe the next phase will be about jointly building businesses, driving innovation and creating solutions that benefit not only our two countries but the wider region.”
Opportunities and Risks
About opportunities and risks that are likely to define the next phase of UAE–India economic cooperation, Chawla said: “I believe the biggest opportunity lies in moving from a trade partnership to a growth partnership. The UAE has become a global gateway for businesses, while India is one of the world's fastest-growing major economies. Together, they have the opportunity to build businesses, create innovation, attract investment and serve markets far beyond our two countries.”
Initiatives such as CEPA have already shown what can be achieved when both nations work with a shared vision. “Looking ahead, I see even greater collaboration in areas such as AI, digital services, logistics, financial services, healthcare, food security and advanced manufacturing. We are also seeing increasing interest from UAE investors in India's growth story, while more Indian businesses are choosing the UAE as their regional and global headquarters. This creates a win-win partnership for both economies.”
Like any fast-growing economic relationship, there will always be challenges — from changes in global trade and regulations to rapid technological disruption and supply chain uncertainties. However, both the UAE and India have consistently demonstrated their ability to adapt quickly and turn challenges into opportunities. That gives businesses the confidence to invest with a long-term perspective.
“For me, the real strength of this relationship is the trust that has been built over the years. When two countries combine a shared vision, complementary strengths and a commitment to innovation, the opportunities are almost limitless. I believe the best chapter of the UAE–India partnership is still ahead of us,” he said.
Sharma said the greatest opportunity is to transform the UAE–India relationship from a successful bilateral partnership into a wider platform connecting India with the Gulf, Africa and Europe. The UAE’s global logistics and financial networks, combined with India’s scale and productive capabilities, can create powerful opportunities in manufacturing, exports, technology and investment.
“There is also considerable potential for greater cooperation between sovereign investors, private businesses, start-ups, financial institutions and family-owned enterprises. As the relationship expands, investment can move beyond traditional large projects into innovation, digital businesses, sustainable infrastructure and high-value manufacturing.
The main challenge will be execution,” he said.
He said the two countries have already created a strong foundation, but the full benefits will depend on faster implementation, easier regulatory processes, efficient customs procedures and greater awareness among businesses about the opportunities available.
“Regional geopolitical developments, shipping disruptions, global economic uncertainty and commodity volatility will remain external risks. However, the diversity of the partnership itself provides resilience. A relationship supported by energy, technology, finance, logistics, food security and manufacturing is better placed to withstand global disruptions,” he said.
The next chapter should therefore focus on making the partnership easier to access, particularly for smaller businesses. “If both countries continue reducing barriers, strengthening connectivity and encouraging private-sector collaboration, UAE–India economic relations can become one of the most dynamic and enduring growth partnerships of the coming decade,” he said.
