The United Arab Emirates (UAE) is one of the most attractive business destinations in the Middle East. Your business in the UAE will have ready access to skilled labour, modern communications and transport networks, and excellent infrastructure. The investment climate in the UAE is generally stable.

The UAE is the easiest country to do business within the Middle East. It topped global rankings for business processes such as getting construction permits and registering property. The law protects minority investors and enforces contracts, giving you ease of mind when you invest there.

Ease of Trade 

The UAE is strategically located between Asia, Europe and Africa. As a key logistics and distribution node in the GCC, the UAE links shipping routes and facilitates transportation of goods between Middle East and the rest of the world.

The UAE has 45 Free Trade Zones (FTZs), each tailored to specific industries, from logistics and power, to media and information technology. These convenient bases allow for 100% foreign ownership, 100% repatriation of capital and profits, and full import and export tax exemptions. You will also enjoy corporate tax exemptions of up to 50 years, no personal income taxes, and get support to recruit your employees.

Take advantage of the minimal trade barriers and tariffs within the region to trade goods at competitive prices. Indian companies which have ventured to the UAE are in a diverse range of sectors, from financial services to urban solutions. They are present across several Emirates including Abu Dhabi, Dubai, Fujairah, and Sharjah.

The UAE is strategically located between Asia, Europe and Africa. As a key logistics and distribution node in the GCC, the UAE links shipping routes and facilitates transportation of goods between Middle East and the rest of the world.

The UAE has 45 Free Trade Zones (FTZs), each tailored to specific industries, from logistics and power, to media and information technology. These convenient bases allow for 100% foreign ownership, 100% repatriation of capital and profits, and full import and export tax exemptions. You will also enjoy corporate tax exemptions of up to 50 years, no personal income taxes, and get support to recruit your employees.

Take advantage of the minimal trade barriers and tariffs within the region to trade goods at competitive prices. Indian companies which have ventured to the UAE are in a diverse range of sectors, from financial services to urban solutions. They are present across several Emirates including Abu Dhabi, Dubai, Fujairah, and Sharjah.

Growing Consumer Market 

For much of the past 15 years, retailers in the Middle East, particularly those in the GCC countries, have benefited from a favourable consumer economy. Apparel, electronics, grocery, and other retail segments have achieved profits and returns above the global industry average.

Consumers in the region are willing to spend their fast-growing disposable incomes, which were rising at two to three times the global average. Strong consumer spending drove the strongest period of growth that the Middle East had ever seen.

Indian companies can consider investing in the food industry in the UAE, such as in modern grocery retail. Consumers in the Middle East are now increasingly relying on supermarkets for food purchases. Indian food companies can use the UAE as a base to expand your business to the region.

Find out how you can work with us and our partners to grow your business in the UAE through assistance in capability development, technology, market access, and more.

Food, Manufacturing & Services:

Demand for packaged and processed foods have risen in the Gulf Cooperation Council (GCC) countries. This is due to high disposable income and busy urban lifestyles. The demand is expected to grow at a healthy pace.

Indian companies can look for opportunities in the UAE’s food manufacturing and food services industries to meet the growing consumer demand. Local food service operators are also keen to invest in food manufacturing facilities to complement their businesses. These give you opportunities for co-investment.

You can also consider exporting your food products to the UAE, where there is a growing trend of Indian food exports to the GCC countries. Exports reached US$359 million (S$485 million) in 2015. With food importers generally placing high trust in the Indian brand, you have an advantage over your competitors.

One avenue to enter the UAE market is by participating in the annual food trade show, Gulfood. This popular platform allows you to connect to food industry buyers and sellers from around the region.

Asian food is also becoming more popular in the Gulf. Indian food companies are exporting to the UAE market.

Logistics 

The UAE is strategically located at the centre of international trade. Its geographical location and infrastructure make the country an ideal supply and re-distribution gateway. One-third of the world’s population lives within a four-hour flight, and two-thirds within eight hours of flight time. It offers huge growth potential for logistics companies.

According to the World Bank’s 2018 Logistics Performance Index (LPI), the UAE ranked 11th out of 160 countries, outperforming its peers in the region. Indian companies will find the UAE one of the most “logistic friendly” countries to operate in or trade with.

The Dubai Chamber of Commerce and Industry expects a compounded annual growth of about 5% in the UAE’s air freight market through 2021. Container port traffic is also expected to rise from 21.3 million twenty-foot equivalent units (TEUs) in 2016 to 28.4 million TEUs by 2021. Dubai can serve as a key node in your trade with the region.

Tourism & Hospitality 

Tourism is a central pillar of UAE’s economic growth and diversification plan. There are opportunities for Indian companies in food and beverage, retail, hospitality and event management to benefit from the UAE’s booming tourism industry.

Dubai is actively promoting itself as a destination of choice. Under its Tourism Vision 2020, the city aims to attract 20 million visitors a year by 2020. This is double the number of visitors to the city in 2012. Dubai’s hosting of the Expo 2020 is expected to help achieve this target.

Sharjah is another UAE emirate offering opportunities in the tourism and hospitality sector. UNESCO declared it the Cultural Capital of the Arab World in 1998, and reaffirmed this recognition in 2014, when it became the Capital of Islamic Culture. Indian companies have started to express interest in Sharjah’s hospitality sector.

India and UAE have shared trade links through the centuries. The trade, which was dominated by traditional items such as dates, pearl and fishes, underwent a sharp change after the discovery of oil in UAE (oil exports begun from Abu Dhabi in 1962).  With the emergence of UAE as a unified entity in 1971, exports from India started growing gradually over the years. The real impetus, however, started after Dubai positioned itself as a regional trading hub by early 1990s and about the same time, the economic liberalization process started in India.

Growing India-UAE economic and commercial relations contribute to the stability and strength of a rapidly diversifying and deepening bilateral relationship between the two countries. Both sides are striving to further strengthen these ties for mutual benefits. India-UAE trade, valued at US$ 180 million per annum in the 1970s, is today around US$59.1 billion making UAE, India’s third largest trading partner for the year 2019-20 after China and US.  Moreover, UAE is the second largest export destination of India (after US) with an amount of over US$ 28.8 billion for the year 2019-20.  For UAE, India is the second largest trading partner for the year 2018 with an amount of around US$ 36 billion (non-oil trade).  During the visit of Prime Minister in August 2015 to UAE, the two sides agreed to further expand bilateral trade by 60 percent in the next five years.

Investments:

There is an estimated US$13-14 billion UAE investment in India of which around US$6.65 billion (March 2019) is in the form of foreign direct investment, while the remaining is portfolio investment. UAE is the eleventh biggest investor in India in terms of FDI. UAE’s investments in India are concentrated mainly in five sectors: Services Sector (15.78%), Sea Transport (8.80%), Power (8.34%), Construction (Infrastructure) Activities (7.15%) and Construction Development: Townships, Housing, Built-Up Infrastructure and Construction-Development Projects (7.08%).

During the visit of Prime Minister in August 2015 to UAE, it is decided to establish UAE-India Infrastructure Investment Fund, with the aim of reaching a target of US$ 75 billion to support investment in India’s plans for rapid expansion of next generation infrastructure, especially in railways, ports, roads, airports and industrial corridors and parks. During the successive VVIP visit, the leaders of both the countries reviewed the progress in realizing the US$ 75 billion target for UAE investments in India.

(a) UAE investments in India

There are a number of joint ventures and investments undertaken by UAE companies in India. EMAAR, a real estate company of Dubai Government, is active in the real estate sector having already set up a major township, an international convention centre and a golf course in Hyderabad.  EMAAR group intends to invest in Maharashtra, Madhya Pradesh and Gujarat in food processing sector creating a food-corridor in the country.

The National Investment and Infrastructure Fund (NIIF), India’s first sovereign wealth fund, signed a US$1 billion investment agreement with a wholly owned subsidiary of the Abu Dhabi Investment Authority (Adia) on 16.10.17, to invest in much-needed energy, transportation and other infrastructure-related sectors in India. ADIA is investing $1 billion in affordable and mid-income housing projects in India’s leading cities. ADIA is among the most active foreign investors in India and has deployed its funds in real estate, private equity and backed two of the largest renewable energy companies of India, investing over $400 million in ReNew Power and Greenko.

The NIIF and Dubai-based ports operator DP World Pvt. Ltd, announced the creation of an investment platform to invest up to $3 billion in ports, terminals, transportation and logistics businesses in India. This is the first investment platform from NIIF and will see investment up to $3 billion of equity to acquire assets and develop projects in these sectors.

Dubai Ports World (DP World) in February 2016 unveiled plans to invest more than US$1 billion in India to expand its container terminals business. The Group has already invested capital of $1.2bn and is currently the only foreign operator with six port concessions in India with approximately 30% market share.

Saudi Aramco and the Abu Dhabi National Oil Company (ADNOC) signed a Framework Agreement to jointly develop the Ratnagiri Refinery and Petrochemicals Limited (RRPCL), a 1.2 million barrels per day integrated mega refinery and petrochemicals complex. It is a strategic partnership and co-investment in the development of a new US $44 billion mega refinery and petrochemicals complex at Ratnagiri.  The agreement defines the principles of the joint strategic cooperation between Saudi Aramco and ADNOC to jointly build, own and operate the complex in collaboration with a consortium of Indian national oil companies currently consisting of Indian Oil Corporation Ltd. (IOCl), Bharat Petroleum Corporation Ltd. (BPCL), and Hindustan Petroleum Corporation Ltd. (HPCL). Saudi Aramco and ADNOC will jointly own 50% of the new joint venture Company RRPCL, with the remaining 50% owned by the Indian Consortium.

Abu Dhabi-based retail giant, Lulu Group, has launched an AED1.7 billion ($460 million) mixed use project in Andhra Pradesh. Through a public private partnership, the group’s project will comprise a 7,000-capacity convention centre, shopping mall and a luxury hotel in Visakhapatnam, and will be one of the largest project of its kind in the state.

Dubai Holdings are lead partners in Kochi Smart City.

Abu Dhabi’s National Petroleum Construction Company(NPCC), has won a major engineering and construction contract to build offshore platforms from India’s Oil and Natural Gas Corporation(ONGC). NPCC will build the WO-16 cluster and SB-14 wellhead platforms project at the offshore Mumbai High Field, valued at Dh550 million.

Ras al-Khaimah (RAK) signed a MoU for a JV with Govt. of A.P for setting up a one million tonne per annum Alumina plant and a 250,000 tonne aluminium smelter. RAKIA  has already commissioned the RAK ceramics factory located at Kakinada in AP. UAE tile manufacturer, RAK Ceramics India, has set up a tile plant in Ahmedabad, at an investment of $150 million.

UAE-based KEF Holdings, a multinational firm specialising in offsite construction technology, has announced the launch of operations in India with a planned investment of AED 900 million.

India’s largest shopping mall, promoted by Abu Dhabi-based EMKE Group, was unveiled in Kochi, Kerala on 10th March 2013.  They are also developing a second LuLu shopping mall, hotel and international convention centre in Kerala’s capital city of Thiruvananthapuram. Spread over 19 acres, this will be the second biggest shopping mall in India after the LuLu mall in Kochi.

Greenko Energy Holdings, one of India’s leading renewable energy firm in the month of June 2016 stated that it has secured $150 million new funds from the Abu Dhabi Investment Authority (ADIA).

UAE-based businessman Mr. B.R. Shetty’s global remittance firm UAE Exchange announced that it has reached a deal to acquire the online remittance business “Remit2India” from Time of Money, India. Remit2India is an online brand with more than 500,000 customers, mainly Indian expatriates, in the US, Canada and Australia.

National Marine Dredging Company (NMDC) from Abu Dhabi has signed a $316 million contract for the EPC of new LNG terminal in Gujarat. This capital development program will include massive dredging and marine infrastructure works. NMDC’s role in the Gujarat LNG scheme will also involve land reclamation activities, construction of breakwaters, jetties and associated facilities. This project award marks a new milestone for NMDC in its strategic expansion plans to expand its operational footprint into Asia.

During the inaugural session of the India Integrated Transport and Logistics Summit 2017 on 4th May 2017 at New Delhi,  Mr. Sultan Ahmed Bin Sulayem, Group Chairman and CEO of DP World- leading global operator of marine and inland terminals, stated that it will invest USD 1 billion more in India to tap into the opportunities the country offers in infrastructure space. This will be in addition to its existing over USD 1 billion investment in India.

(b) Indian investments in UAE:

Though no official figures are available, investments by Indian companies in UAE would be in excess of US$85 billion.  Many Indian companies have set up manufacturing units either as joint ventures or in Special Economic Zones for cement, building materials, textiles, engineering products, consumer electronics etc. Many Indian companies including Taj Group of Hotels have also invested in the tourism, hospitality, catering, health, retail and education sectors. Hinduja Group has set up manufacturing units for Ashok Leyland vehicles in Ras-al-Khaimah.

The EMKE Group under the banner ‘Lulu’ set up by an Indian national dominates the retail/departmental sectors in UAE. Al-Faraa group is a booming construction-sector company. Indian cement manufacturer JK Cement is investing US$14.97 mn to set up a white cement plant with a capacity to produce 0.6 million tones per year(mtpy), in Fujairah Free Trade Zone.  Indian companies like Ashok Leyland, Mahindra, Dabur etc. operate out of the business parks of Ras Al Khaimah Investment Authority. Zuari Agro Chemicals and Tata Power are also setting up units in Ras Al Khaimah ($800 mn fertilizer plant and $250mn sugar plant). India’s Essar Steel Processing and Distribution (ESPD), part of Essar Steel, has a service centre facility in Dubai (capacity: 250,000 tonnes) to cater to the needs of customers in Middle East and neighboring region.

The region has traditionally been one of Apollo Tyres’s strongest export markets, accounting for about 30% of export revenues. The company has opened an office in Dubai and its distribution network in the Middle East is spanning 14 countries and 23 business partners.  India’s Infrastructure Leasing & Financial Services Limited (IL&FS) and UAE-based Prime Terminal have jointly pumped in Dh477 million ($130 million) in an oil storage terminal at Fujairah. IL&FS Prime Terminals, a joint venture formed between IL&FS Maritime Infrastructure Company Limited (IMICL) and PTF, reached an agreement on the first phase of the 632,678 cubic metres project. This will help boost the fuel storage capacity to increase from 5.08 million cubic metres to 7.95 million cubic metres.

Indian television major Zee Entertainment has invested in the satellite television network in the Middle East, with Dubai as its base. It is already running a special Arabic channel Zee Aflam devoted to bollywood entertainment.  In September 2012, Zee announced a $100 million investment in Zee Alwan – Dubai, the second Arabic channel by Asia’s largest television provider.

Birla Institute of Technology & Science (BITS) Pilani in India opened its international campus in Dubai on December 2007 –  BITS Pilani, Dubai.  It is the one of the dedicated engineering institutions in the region and has the largest campus spread across a 15-acre plot in Dubai International Academic City with an excellent academically conducive infrastructure and highly qualified faculty. Other Educational Institutions set up by Indian entities are Manipal University, Mahatma Gandhi University, Pune University, S P Jain School of Global Management etc.

Major Indian companies such as L&T, ESSAR, Dodsal, Punj Lloyd, ElL etc. have been able to obtain significant number of contracts in the UAE.  L& T and its Oman-based subsidiary have secured major contracts in water supply projects, construction, oil, electric transmission and other sectors. In June 2011, India-based PCM Strescon Overseas Ventures Ltd (Siliguri, West Bengal) signed a contract worth US$40 million with Etihad Rail for design & manufacture of railway sleepers as well as production of sleeper manufacturing facility for Phase I of the railway network of 266 km route linking Shah, Habshan and Ruwais in the Abu Dhabi western region.  Etihad Rail is one of the ongoing project in Abu Dhabi.

There are over 1000 direct flights operating every week between various destinations in India and UAE, serviced by Air India/Air India Express, Jet Airways, Spicejet, Indigo, Emirates, Etihad, Flydubai and Air Arabia.

FTAs

On the multilateral framework, India and GCC have signed a Framework Agreement on Economic Cooperation on 25th August 2004 acknowledging the growing importance of economic and commercial relations between India and GCC countries and to facilitate entering into a Free Trade Agreement (FTA). The first round of negotiations on FTA took place at Riyadh on 21-22 March 2006.  The progress has been slow since the process of integration within the GCC has been slow and there are concerns in India about providing free access to petroleum products from GCC.

Precious metals, mineral fuels, electrical machinery, vessels & ships, apparel, iron & steel, vehicles, machinery, and articles of iron or steel.

According to ITC Trade Map, India currently has an untapped export potential of US$ 24.3 billion to UAE led by jewellery of precious metal, diamonds, semi/wholly milled rice, jewellery of silver and motor vehicles.

 Ambassador

amb.abudhabi@mea.gov.in

024447729

Second Secretary (PPS) to Ambassador

amboffice.abudhabi@mea.gov.in

024447729