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India-UAE Relations

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India and the United Arab Emirates (UAE) share a millenia old cultural, religious and economic relation between them. Barter trade and people-to-people contact have existed here for centuries. The relationship between these countries got formalized when diplomatic relations were established in 1972. Since then, both the nations have made sincere efforts to improve the relationship between them.

In 2015, Indian Prime Minister’s visit to the UAE gave a new thrust to the relations between these nations. It marked the start of an era of a New Strategic Partnership between India and UAE. Further, in January 2017, Crown Prince of Abu Dhabi was invited as a Chief Guest at India’s Republic Day celebrations. This gave a thrust for starting negotiations for an India-UAE Comprehensive Economic Partnership Agreement (CEPA). Finally, in February 2022, both these nations signed a CEPA. (India-UAE CEPA)

The relations between these nations can be understood under the following broader headings;

  • Areas of Cooperation between India-UAE:

    1. Economic and Commercial Relations: UAE is India’s third largest trading partner and second largest export destination after the USA. UAE is also the 9th largest source of Foreign Direct Investment (FDI) into India. UAE’s investment into India accounts for almost $11 billion.
    2. Defense Cooperation: Desert Eagle is a bilateral exercise conducted between the Indian Airforce and the UAE Airforce. Both countries recognize the threat posed by the non-state extremist groups in the region. Hence, after signing of the Abraham Accord between Israel and UAE, the idea of Western QUAD has emerged with India, Israel, USA and UAE as its members. UAE had also supported and recognized Jammu and Kashmir Re-organization Act passed by India.
    3. People-to-People Contact: UAE is home to almost 3 million Indians making it the largest expatriate community in the UAE. UAE in its document named Vision-2021 has highlighted the need of diversifying their economy had reducing their dependence oil. In the light of this, UAE have started issuing Golden Visa Residency Permits which would attract a lot of Indian professionals into UAE. Also, a large diaspora in UAE makes it a hub for sending remittances into India.
    4. Space Co-operation: Indian Space Research Organization (ISRO) and UAE Space Agency (UAESA) have jointly developed a nano-satellite named Nayif-1.
    5. Shared Geo-Political Vision: While UAE Look(s) East to find new strategic partners for addressing its economic and security concerns, India with its West Asia policy provides UAE with a shared vision for addressing these concerns.
  • Areas of Confrontation between India-UAE:

    1. UAE is a member nation of Organization of Islamic Countries (OIC). This organization has been very vocal on the stance of Kashmir.
    2. UAE has also been a source for money laundering. This laundered money is then used for financing terror and extremist activities in India.
    3. India finds itself in a tough position when it comes to balancing the relations between the Arab world and Iran. The constant conflict between Shia dominated Iran and the Sunni dominated Arab world makes it a difficult task for India to satisfy her national interests.

Why is UAE drifting towards India?

In the recent times it has been observed that UAE has been drifting more towards India when we consider UAE’s Look East approach to find new strategic partners. The reasons for this can be understood as follows;

  1. Inability of Pakistan to meet the expectations of UAE: Pakistan has failed to come to the aid of the Arab world, especially when it comes to fighting the Iran-supported Houthi rebels in Yemen.
  2. The problem of terrorism: Both India and the UAE have an identical stand with regards to terrorism and both the nations talk of the need to eliminate terrorism.
  3. India as a huge market for oil and energy: UAE considers India as a huge market for its oil exports.
  4. Under its Vision 2021 document, UAE is now focusing on diversifying its economy and reducing its dependence on oil-based economy. India provides an ideal market for UAE to diversify its economy.

Way Forward:

  1. Using UAE as its strategic ally in West Asia, India needs to alleviate its relations with other nations in the Gulf Cooperation Council (GCC).
  2. India should leverage its newly signed CEPA agreement with UAE in order have a relatively easy access to the African market.


Gulf Cooperation Council (GCC)

  •  It was established in 1981.
  •  Member Nations:  Qatar, Kuwait, Bahrain, Saudi Arabia, Oman, UAE
  •  It promotes economic, cultural, security and social cooperation between the above mentioned six states.

Gulf Cooperation Council


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