InFocus | India
Working towards mutual gain
India today is recognised as the most attractive destination for foreign direct investment. It is not surprising that more and more multinationals worldwide are acquiring a stake in the Indian economy.
- By C.M. Bhandari
- Published: 00:00 August 14, 2006
- Image Credit: AP
- Indian Pavilion, depicting New Delhi's Red Fort in its full glory, at the Dubai Global Village in February this year.
The happy and joyous occasion of the 60th Independence Day of India, I take this opportunity to greet my compatriots residing in the UAE. On behalf of the President of India, the Prime Minister of India and the government and people of India, and also on my own behalf, I also convey greetings to our brothers and sisters of the UAE.
I convey our good wishes for the health, happiness and prosperity of President His Highness Shaikh Khalifa Bin Zayed Al Nahyan, His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, Their Highnesses Members of the Supreme Council and Rulers of the other emirates, all the Crown Princes and Government of the UAE.
Attractive destination
India today is recognised as the most attractive destination for foreign direct investment. With a GDP of $700 billion, growing at more than seven per cent per annum and providing the best returns anywhere in the world, it is not surprising that more and more multinationals worldwide are acquiring a stake in the Indian economy.
During the recent India-Gulf Economic Partnership Summit meeting on June 15, 2006, in Dubai, I was impressed to hear from the representative of the Standard Chartered Bank that two per cent of its global investments in India provide 10 per cent of returns in the bank's global balance sheet.
He told the audience that about 20,000 Indians are working in the bank's branches worldwide and its IT solutions are solely provided from India. The same is the story of hundreds of business and industry houses in India and many UAE companies that are also keen to join their ranks.
Relations between India and the UAE have been long-standing and close.
Whether we talk of cricket - the Indian national cricket team and 'A' team played matches in Abu Dhabi during March-April this year, or Bollywood - the entire Indian film stars and industry swooped on Dubai for the sixth India International Film Awards (IIFA) in June this year, or relations on political, commercial and people-to-people level contacts, there is so much happening on a regular basis that reflects the close relations our two countries enjoy.
Challenges of globalisation and industrialisation have brought forth new complexities in international relations. The world community aspires for economic growth, stability and peace but ground realities in many parts of the world, including in the Gulf and Middle East, provide us a strong reminder that a lot more needs to be done than mere rhetoric.
It is of utmost importance that relations between countries and societies are promoted on fundamental principles of peaceful coexistence in a multi-ethnic and multi-religious democratic pluralistic society.
Relations between India and the UAE are matured and multi-dimensional. There are regular exchanges of visits at the highest political level.
Ministerial level visits are frequent. During the first seven months of 2006, the Vice-President of India, Ministers of Commerce and Industry, Overseas Indian Affairs, Agriculture and Cooperation, Human Resource Development and Minister of State for Parliamentary Affairs, paid visits to the UAE.
Chief Minister of Karnataka also led a high-powered delegation. From the UAE, several business leaders have been visiting India on a regular basis and visits of the Vice-President and Foreign Minister of the UAE are projected in the near future.
Growing trade
India-UAE trade has also been growing. During the financial year April 2005-March 2006, non-oil exports of India to the UAE were of the order of $8.6 billion whereas non-oil exports of the UAE to India were of the order of $4.3 billion. The overall bilateral trade went up from about $12 billion in the last financial year to about $13 billion in the year 2005-06.
Both countries are exploring opportunities for large-scale investments in the other. Several companies of the UAE, such as Emaar, Dubai Holdings, DP World, Abu Dhabi Investment Authority (now Abu Dhabi Investment Council), Dubai Aluminium, to name a few, are currently pursuing many large-scale investment projects in India in infrastructure, mining, real estate, ports and airports, tourism and knowledge-based sectors.
Major presence
From India, almost every major corporate house has a presence in the UAE by way of actual investments, trade or representative office. It is estimated that more than 3,300 Indian companies have set up manufacturing units or opened local offices in the UAE.
More than 600 of them are located in the Jebel Ali Free Zone whereas others are in the Free Trade Zones in Sharjah, Ajman, Ras Al Khaimah and Fujairah.
The Hyderabad-based cement manufacturing company, Penna Cements has put up a cement-manufacturing unit in Ras Al Khaimah in a joint venture with the government of the emirate at a projected cost of $100 million.
Other major groups with investments in the UAE include Mahendra Group, Ashok Leyland and Mumbai-based property developer Dheeraj Group. Several educational institutions, IT majors, engineering and construction companies are also actively engaged in the UAE and many more are exploring new opportunities for investment here.
Both governments are providing encouragement to the ongoing economic cooperation between the two countries. Officials from both sides are currently engaged in reviewing a Double Taxation Avoidance Agreement and giving final touches to the Bilateral Investment Promotion and Protection Agreement.
The two countries are also actively engaged in a Bilateral Agreement to abolish visas for diplomatic and official passport holders.
People-to-people contacts between both countries are constantly on the increase. Tourists from both sides are visiting for leisure and pleasure. More and more UAE nationals are availing of healthcare and tourism facilities in India.
India's entertainment and film industry is already engaged in the UAE in a big way, as was also witnessed during the IIFA festivities during June 14-16 in Dubai.
Human bonding
Close bonds between the Indian community and the nationals can be judged from the fact that the Indian community is the largest expatriate community in the UAE, numbering about 1.3 million.
The Indian workforce is hardworking, sincere, productive and apolitical. If we have a large labour force employed at the construction sites, municipal services and farms, then we also have people in the skilled and professional categories, providing cutting-edge advantage to the businesses and industries in the UAE. Indian professionals are in demand all over the world and the UAE is no exception.
I have no doubt that the strong bonds of friendship between India and the UAE will be further diversified and strengthened in months and years to come.
The Indian expatriate community in the UAE is the bedrock of India-UAE partnership. In paying tribute for their hard work and contribution towards cementing our ties, I convey my good wishes for their well-being and happiness.
- The writer is Ambassador of India to the UAE
