DP World Ltd’s Nhava Sheva port in Navi Mumbai. The UAE and India set up an infrastructure investment fund with a target of $75 billion when Modi visited the UAE in August last year. Image Credit: Bloomberg

Abu Dhabi: The UAE’s investments in India have increased to nearly $1 billion (Dh3.67 billion) over the past year as bilateral trade between the two countries strengthen, Indian ambassador to the UAE T.P Seetharam told Gulf News.

“The UAE, which used to be the tenth largest investor in India is now the seventh largest investor with the investments from the country going up to about one billion dollars in the last one year,” he said.

The total foreign direct investment inflows from the UAE to India stood at $4.03 billion ending March 2016, from April 2000, said Seetharam citing official figures.

He attributed the rise in investment figures to a good economic climate in India and also due to growing ties between the two countries following the visit of Indian Prime Minister Narendra Modi to the UAE in August last year. UAE leaders have made subsequent visits to India since.

UAE’s Foreign Minister Shaikh Abdullah Bin Zayed Al Nahyan visited India in September and His Highness Shaikh Mohammad Bin Zayed Al Nahyan Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces visited India in February this year.

The two countries set up the UAE-India Infrastructure Investment Fund with a target of $75 billion (Dh275 billion) when Modi visited the UAE in August last year.

Strategic petroleum reserves

The two countries also sought to promote strategic partnerships in the energy sector, including through UAE participation in India in the development of strategic petroleum reserves, upstream and downstream petroleum sectors.

Seetharam said there is progress on several of the key issues which were agreed upon during the PM visit to the UAE, a year ago including in areas such as the UAE’s space programme, defence cooperation and oil storage in India’s strategic petroleum reserves.

On oil storage by Abu Dhabi National Oil Company (Adnoc) in India’s strategic petroleum reserves, he said both countries are working to iron out tax-related matters.

“They have a draft on which they are working. We expect another delegation from India coming to Abu Dhabi shortly. Things are moving forward, moving in the right direction and making progress.”

In February, Abu Dhabi National Oil Company (Adnoc) said it was keen on taking storage facilities at the Mangalore facility on the west coast of India.

Under the strategic petroleum services agreement reached at the same time, Adnoc plans to stock 0.75 million tonnes or six million barrels of oil at the facility, giving two- thirds of that to India.

Benefiting from oil drop

Meanwhile, the drop in oil prices has been benefiting India. Although the volume of oil imported rose by 25 per cent in 2015-16 over the previous year, the value of imports fell to $7.9 billion dollars in 2015-16 compared to $13.6 billion (Dh49.9 billion) in the previous financial year largely due to a decline in crude oil prices during that period.

The total bilateral trade between the two countries for the year 2015-16 is around $50 billion, which has gone down from $59.1 billion when compared to the previous year, the Indian ambassador said.

The UAE is India’s third largest trading partner after China and the US, whereas India is the largest trading partner for the UAE for the year 2015, according to the embassy.