File photograph of Union Commerce and Industry Minister Piyush Goyal with UAE Economy Minister Abdulla bin Touq Al-Marri throughout a gathering on Comprehensive Economic Partnership Agreement, in New Delhi
| Photo Credit: PTI
The United Arab Emirates (UAE), with which India carried out a Comprehensive Economic Partnership Agreement (CEPA) in May final 12 months, has emerged as the fourth largest investor in India throughout 2022-23, based on authorities knowledge.
In the final fiscal, Foreign Direct Investment (FDI) from the UAE to India jumped over three-fold to $3.35 billion from $1.03 billion in 2021-22, the info of the Department for Promotion of Industry and Internal Trade (DPIIT) confirmed. The UAE was the fourth largest investor in India in 2022-23 in comparison with the seventh in 2021-22.
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Singapore was the largest investor in India with $17.2 billion funding in FY23, adopted by Mauritius with $6.1 billion and the U.S. with $6 billion).
“The rapidly strengthening of bilateral ties and investment cooperation between India and UAE can be chiefly attributed to the strong bilateral relations between India and UAE, growth in investment commitments from UAE, and the policy reforms to further ease of doing businesses between the two countries,” Rudra Kumar Pandey, Partner, Shardul Amarchand Mangaldas & Co, stated.
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UAE’s investments in India are primarily in sectors like providers, sea transport, energy and building actions.
One of the essential elements for the rise in FDI from UAE is the signing of the CEPA between India and UAE on February 18, 2022 (efficient from May 1, 2022), Mr. Pandey added.
“Apart from CEPA, another growth engine of FDI from UAE in India is the investment commitment from UAE. UAE has committed to invest $75 billion in the Indian infrastructure sector over a period of time. It has also committed to partner with India in the renewable energy sector,” Mr. Pandey famous.
Under the CEPA, plenty of items from each international locations are getting zero-duty entry to one another’s markets, apart from eased norms for selling investments.
The nation accounts for about 2.5% of the entire FDI India obtained between April 2000 and March 2023. During this era, India has attracted $5.6 billion value of abroad inflows from the UAE, the info confirmed. According to consultants, the commerce agreements have helped considerably enhance the import and export between the international locations and consequently elevated the investments from UAE in Indian firms.
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“India’s constant liberalisation of the FDI policy also boosted such investments. Similarly, we are also seeing that several Indian startups are exploring expansion in the UAE,” Anindya Ghosh, Partner, IndusLaw, stated.
She stated that amongst different companies, Abu Dhabi Investment Office by means of their Innovation Program is offering lively help to innovation-driven startups by means of monetary and non-financial incentives like data on knowledge, community, licensing, logistics, actual property, visa and so on.
“Such expansion ideas/ activities of Indian startups also provide an incentive to UAE-based investment funds to invest more in innovation-based startups in India,” Ms. Ghosh added.
