By TIOL News Service

MUMBAI, OCT 08, 2024: THE 12th Meeting of the India-UAE High Level Joint Task Force on Investments (HLJTFI) took place in Mumbai yesterday. It was co-Chaired by Piyush Goyal, Minister of Commerce & Industry, Government of India and His Highness Sheikh Hamed bin Zayed Al Nahyan, Managing Director of Abu Dhabi Investment Authority (ADIA).

The HLJTFI was established in 2013 to promote trade, investment and economic ties between India and the UAE. Since its formation, it has provided an effective mechanism to discuss opportunities and prospects for further investments in India and the UAE, while acting as a forum to resolve issues faced by investors of the two countries.

During the 12th HLJTFI meeting, the Co-Chairs acknowledged the continued growth and strengthening of the bilateral relationship between India and the UAE, including on trade and investment related matters. The India-UAE Bilateral Investment Treaty, signed during Prime Minister Modi's visit to the UAE in February 2024, has been ratified by both sides and entered into force with effect from 31 August 2024. 

The Co-Chairs also acknowledged the rapid rise in bilateral trade under the Comprehensive Economic Partnership Agreement (CEPA), which came into force in May 2022. The Joint Task Force reviewed the working of the India-UAE CEPA, which was one of the fastest-ever negotiated Free Trade Agreements. This landmark agreement designed to stimulate increased trade and boost the trading relationship between the two countries. During the course of the last two years, the CEPA has helped reduce tariffs on the majority of product lines, sought to address other barriers to trade and created new avenues for cooperation. As a result of the deal, bilateral trade has risen consistently, with non-oil trade rising to USD28.2 billion in the first half of 2024, a 9.8% year-on-year increase. The agreement has also spurred FDI - as of 2023, the UAE is India's fourth largest foreign investor with USD3.35 billion committed across a wide range of sectors, representing a threefold increase on 2022. Indian FDI into the UAE in 2023 totalled USD 2.05 billion, more than 2021 and 2022 combined. These figures represent real growth with real, on-the-ground impact. Further, it has led to job creation in Indian market and export from labour-oriented sectors is growing rapidly.

Considering the strategic agreements and initiatives signed during the recent official visit of H.H. Sheikh Khalid bin Mohamed Al Nahyan, Crown Prince of Abu Dhabi, to India, the two sides noted the existing and future investments and projects of UAE entities in key sectors of the Indian economy, including energy, artificial intelligence, logistics, food and agriculture, which total approximately USD100 billion. The meeting also reviewed UAE investments in Indian infrastructure assets.

During the HLJTFI meeting, the two sides reviewed progress on several key initiatives, including some that were previously announced by Indian Prime Minister Narendra Modi and UAE President Sheikh Mohamed bin Zayed Al Nahyan, and expressed satisfaction at the rapid pace of implementation. These initiatives include bilateral trade in local currencies, the integration of payment systems of India and the UAE, cooperation on Central Bank Digital Currencies, the launch of work relating to a Virtual Trade Corridor and the development of a food park in Ahmedabad. 

Food parks are among areas for greater collaboration and investments between India and UAE. It will lead to higher income for farmers, jobs' creation in food processing sector, and enhance food security for UAE. Small working groups between Central Government, State Governments and UAE Government will take forward food corridors between the two countries on a mission-mode basis. The strong progress made on these initiatives attests to the high level of commitment from both sides to ensure the implementation of their respective leaders' visions. 

The two sides welcomed the announcement of the Abu Dhabi Investment Authority (ADIA) establishing a subsidiary at GIFT City. This underlines the strong interest from UAE's institutional investors in India's growing and dynamic economy, and GIFT City's reputation as world-class financial services centre, operating under a strong regulator and a robust legal framework.

To augment the relationship, National Payments Corporation of India (NPCI), via its international subsidiary NPCI International Payments Limited (NIPL) is collaborating with Al Etihad Payments (AEP), to enable creation of domestic card scheme JAYWAN in UAE. The JAYWAN card scheme is an outcome of deep collaboration between NIPL and AEP. It is based on the RuPay card stack (developed and deployed at great scale by NPCI in India), which is shared with the AEP to enable UAE be sovereign in the area of digital payments. The two governments are now working on interlinking the two national payment platforms - UPI (India) and AANI (UAE), which will facilitate seamless cross-border transactions between the two countries. This will benefit over 3 million Indians residing in UAE enabling them use power of UPI and AANI, for real-time cross-border remittance, which is aligned with the vision of bringing speed, transparency, accessibility and cost efficiency in cross-border remittances.

The Government of India has also decided to open an office of Invest India in Dubai, UAE to serve as a dedicated point of contact for potential UAE investors seeking to invest in India. The issue was discussed during the India-UAE HLJTFI meeting today. This will be the first such overseas office of Invest India in the Middle East region and its second overseas office overall after Singapore.

In course of the HLJTFI meeting, the Co-chairs Piyush Goyal, Commerce & Industry Minister of India, and His Highness Sheikh Hamed bin Zayed Al Nahyan, Managing Director of Abu Dhabi Investment Authority, also expressed satisfaction on the progress being made by Bharat Mart. Work on the ground has commenced, and design work on the layout of retail spaces and warehousing is making rapid progress.

The HLJTFI provides a forum to deliberate on ways and incentives for encouraging further growth in investment flows from both sides. In this context, the Indian side shared opportunities for investments in priority sectors like renewable energy, green hydrogen, pharmaceuticals and genomics, among others. The UAE side also raised opportunities for investment in India's aerospace sector, due to the rapid growth of its aviation market.

Issues related to investments from both sides, as well as specific challenges faced by companies from both countries, were also discussed during the meeting, with a view to removing obstacles and facilitating their resolution. The Co-Chairs directed both teams to work together and with the relevant government entities to address these issues in a timely and mutually acceptable manner. 

The HLJTFI meeting was attended by Amardeep Singh Bhatia, Secretary, Department for Promotion of Industry and Internal Trade (DPIIT), Government of India; Sunjay Sudhir, Ambassador of India to the UAE, H.E. Dr. Abdulnasser Jamal Alshaali, Ambassador of the UAE to India, and a number of senior officials from both the governments.

Piyush Goyal, Commerce and Industries Minister, Government of India, and Co-Chair of the HLJTFI said: "India-UAE partnership stands on the pillars of innovation, investment and sustainable development. The Joint Task Force meeting today was useful to take a stock of all the laudable initiatives that India and the UAE have jointly undertaken, such as local currency settlement, virtual trade corridor, Bharat Mart, and so on. With the strong framework now provided by India-UAE CEPA and Bilateral Investment Treaty, I encourage stakeholders to further explore investment opportunities and trade possibilities."

His Highness Sheikh Hamed bin Zayed Al Nahyan, Managing Director of the Abu Dhabi Investment Authority (ADIA) and Co-Chair of the HLJTFI, said: "The India-UAE CEPA, signed in 2022, has been a major catalyst for strengthening economic ties and enhancing cross-border trade between the UAE and India. Against this positive backdrop, the Joint Task Force continues to play an important role as a forum to explore new investment opportunities, remove impediments to further cooperation and work together in pursuit of shared goals."