Business | Economy
UAE-India trade shifts to surplus
Report attributes positive change to 273% increase in non-oil exports
- Staff Report
- Published: 00:00 September 5, 2010
- Image Credit: Hadrian Hernandez/Gulf News
- A view of the dhow wharfage area in the Deira Creek in Dubai. Many goods are exported to India by dhows and the value of commercial exchange between the UAE and India has increased from Dh108 billion in 2009 to Dh120 billion in 2010.
Abu Dhabi: A report released by the Ministry of Foreign Trade on the commercial and investment ties between the UAE and India has revealed a positive shift from a deficit during the first quarter of 2009 worth around Dh7.3 billion to a surplus in the UAE's favour during the first quarter of 2010 worth Dh2.2 billion.
The report, which was conducted by the Analysis and Trade Information Department at the Ministry, attributed this positive change to the big increase of 273 per cent in the value of UAE non-oil exports that went up from Dh2.2 billion during the first quarter of 2009 to Dh8.4 billion, in addition to the increase in the value of India-bound re-exported UAE commodities by 162 per cent, going up from Dh4.4 billion to Dh11.5 billion during the same comparison period.
The report, which was prepared by the Ministry's Economic Analyst, Yousuf Diab, revealed that when conducting a comparison between those two quarters, it would be revealed that there is a large 83 per cent increase in the value of non-oil foreign trade between both countries from Dh20.5 billion to Dh37.5 billion.
The report affirmed that these indicators reflect the strength of existing bilateral ties between the UAE and India and the strength of the UAE's economy and its development that are seen as a direct result of the implementation of the country's policy and strategy of increasing economic openness, and its execution and establishment of a free market policy, a diversified economy, and increasing the UAE's non-oil exports in order to increase their contribution to the GDP.
The report also indicated that India is the UAE's largest trade partner, while the UAE is the number one trade partner for Indian exports, and the second trade partner with regards to Indian imports, coming in second only after China.
The report expects the value of commercial exchange between both countries to increase from Dh108 billion in 2009 to Dh120 billion in 2010.
It also revealed that the UAE is considered the number one Arab country, and the 10th globally in terms of the overall value of Foreign Direct Investment inflows into India, preceded by Mauritius, Singapore, the USA, the UK, Holland, Japan, Turkey, Germany, and France.
Direct investment
This was based on a survey of UAE investments abroad conducted by the Ministry of Foreign Trade that revealed that the investments of a group of large UAE companies in India reached Dh5.7 billion up until the year 2009 constituting 1.4 per cent of overall global foreign direct investments into India.
The report predicted that the value of UAE investments in India will reach Dh6.9 billion by the year 2011.
The report also indicated that UAE investments in India have witnessed a steady increase over the past 10 years. From approximately only $1.6 million in 2000, constituting 0.05 per cent of total Foreign Direct Investments in India at the time, to $257 million in 2008, constituting 0.94 per cent of overall Foreign Direct investments in India during the year, reaching $629 million — constituting 2.43 per cent of overall Foreign Direct investments in India — in 2009, up by 145 per cent in comparison with 2008.
UAE investments in India were concentrated in five sectors that took a 48.6 per cent share of these investments. The energy sector received 19.1 per cent, worth $264 million, followed by the services sector at 9.3 per cent ($143 million), then by programming and construction at 7.8 per cent ($115 million) and 6.8 per cent ($99.2 million) respectively, while investments in tourism and hotels came in the fifth place at 5.6 per cent ($84 million).
- Dh8.4b UAE non-oil exports in first quarter of 2009
- Dh5.7b UAE investment in India in 2009
- Dh6.9 UAE investment likely to reach in India in 2011
Exports to Saudi Arabia
UAE exports to Saudi Arabia in June 2010 surpassed Saudi Riyal 1 billion (Dh 979 million), while Saudi exports of national origin to the UAE valued at SR 961 million, according to official figures. The Central Department of Statistics and Information said in a report yesterday Saudi-made non-oil exports to member states of the Arabian Gulf Cooperation Council rose SR 20 million in June 2010 to about SR 2 billion while its imports surged
SR 54 million from these countries stood at SR 1.7 billion. Kuwait took the second slot after the UAE exporting goods worth SR 360 million to Saudi Arabia and importing goods worth SR 115 million.
— WAM
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