Dubai: The India-UAE CEPA deal is leading to ‘deeper border integration’ in global value chains, according to Piyush Goyal, India’s Minister of Consumer Affairs, Food and Public Distribution.
“Food security is an area of high priority and interest to both countries,” said Goyal. “With CEPA, exports of food and agricultural products from India to the UAE are getting a natural boost, it complements agreements on the food security corridor. (This) will strengthen the infrastructure and create dedicated logistics services.
“It will then become a key part of the global food value chain catering to markets beyond the UAE.”
Goyal – speaking at the India-UAE Partnership Summit in Dubai - said the second sector to get a big boost from CEPA is gems and jewelry. It is one of the ‘top-rated’ categories and ‘among the sectors that have gained the most since the implementation of the CEPA,” he said. “To provide further impetus, the Gem and Jewellery Export Promotion Council has set up an Indian Jewellery Exposition Centre in Dubai.”
Goyal said that this move will cement India’s position as a global trading hub for gold and diamonds. “The IJEX acts as a one-stop destination for the world to source Indian jewelry in Dubai - again, a win-win situation.”
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According to industry sources, India’s gem and jewelry exports in FY2022-23 grew by 8.26 per cent, aided by the UAE-India economic partnership treaty. The Comprehensive Partnership Agreement between UAE and India came into effect May 1, 2022, leading to lower import duties across sectors.
Real potential of CEPA
Speaking on the sidelines of the India-UAE summit, Goyal said that there are many examples of how these complementarities are waiting to be further leveraged. And the real potential of CEPA can be unleashed to reap optimal benefits. “If we do that, I'm sure we'll be able to surpass relatively modest targets to induce the bilateral merchandise trade to $100 billion,” he said. That's about twice the pre-pandemic trade flows between the countries.
India hopes to see its exports that $1 trillion in the near to medium term, and the growing bilateral trade with UAE, according to the minister, will play an integral role in the efforts to double the size of its economy by 2030. “The destinies of the UAE and India have been inextricably intertwined for centuries,” said Goyal. “A closer collaboration and current friendship, trust, and the spirit of entrepreneurship will create limitless opportunities for our economies, for our industries, our cities and our people now and for generations to come.”
Goyal said that there are many areas of cooperation ranging from virtual trade corridors, and green energy to waste management. He said that the opportunities in the financial world are something that India looks forward to expanding in.
“India and the UAE have attractive, competitive and complimentary startup ecosystems,” said Goyal. “And a golden era of entrepreneurship is emerging from various states and cities of India, including Bangalore, Mumbai, New Delhi, and the business hubs in the UAE, like Abu Dhabi and Dubai.”
The UAE is India’s third largest trading partner after the US and China. The UAE and India signed the CEPA in 2022 to boost bilateral trade and investments. The negotiations were concluded in 88 days.
CEPA aims to increase trade between the two countries from $45 billion to $100 billion within five years. The UAE will remove customs tariffs on nearly 80 per cent of Indian goods. It has been estimated that after the agreement, bilateral trade has increased by 30 per cent and that CEPA has the potential to generate one million jobs in India.