Commerce and Industry Minister Piyush Goyal on Friday said the signing of a free trade agreement between India and the United Arab Emirates (UAE) will help boost bilateral trade to $100 billion in the next five years and create millions of jobs. Will get
Goyal told reporters after the signing of the Free Trade Agreement (FTA) between India and the UAE that the Comprehensive Economic Partnership Agreement (CEPA) may come into effect in May and from day one, around 90 per cent of the products of Indian interest will be covered. Exports to UAE will open.
The trade agreement was signed during the online summit between Prime Minister Narendra Modi and the Crown Prince of Abu Dhabi, Sheikh Mohamed bin Zayed Al Nahyan. The agreement was signed by Goyal from the Indian side and Abdullah bin Touq Al Marri, UAE Minister of Economy. The two countries also released a framework to further strengthen ties in various fields.
Companies in India and UAE will get significant benefits from the free trade agreement. This includes better market access and lower fee rates. The FTA is expected to increase bilateral trade between the two countries to $100 billion from the current $60 billion in the next five years.
It is noteworthy that India and UAE started formal talks for a trade deal in September last year. The total 881-page settlement was completed in a record 88 days.
Goyal said that this is a comprehensive and balanced trade agreement.
The minister said, “This is a remarkable new agreement, which has benefited the pharmaceutical industry for the first time. This will open doors for our products in the UAE… Because of the trade hub, the UAE is the gateway to other countries in West Asia and the entire African continent.”
The agreement will create one million jobs in labor intensive sectors like textiles, handlooms, gems and jewellery, leather and footwear.
On the pharmaceutical sector, Goyal said the UAE has agreed that medical products made in India approved by the European Union, UK, Canada or Australia will have market access and regulatory approvals within 90 days of submission of applications.
While the UAE has agreed to do away with duty on Indian jewellery, India will exempt up to 200 tonnes of duty on gold imports.
Talking about the benefits of the Indian services sector, he said the agreement would lead to easier market access for various services sectors.
Referring to the benefits to UAE investors, Goyal said that both sides are looking at an arrangement in India that will accelerate investments in the infrastructure and logistics chain.
He also said that security measures have also been taken in the agreement. Permanent security measures have been taken in this.
The minister said that the UAE government agency will certify the origin of the products. Therefore people cannot take goods from any third country.
The UAE’s Minister of State for Foreign Trade Thani bin Ahmed Al Zeyodi said the agreement would increase the UAE’s national GDP by 1.7 percent, or $8.9, by 2030, and increase exports by 1.5 percent.
The agreement covers areas such as goods, services, rules of origin, customs procedures, government procurement, intellectual property rights and e-commerce.
In these types of agreements, both partner countries significantly reduce or eliminate customs duties on most traded goods. In addition, they liberalize regulations to increase business and accelerate investment in the services sector.
Bilateral trade between the two countries stood at $43.3 billion in 2020-21.
The UAE is considered the gateway to Africa and other parts of the world.