Officials from India and the United Arab Emirates (UAE) convened in New Delhi on Thursday for a crucial review of their landmark Comprehensive Economic Partnership Agreement (CEPA). The meeting aimed to assess the pact's performance and tackle operational hurdles that are slowing down trade between the two strategic partners.
Addressing Key Trade Frictions
The Joint Committee established under CEPA focused on resolving specific bottlenecks that have emerged since the agreement's implementation in 2022. Major discussion points included gold import quotas, data-sharing protocols, rules of origin certification, and regulatory coordination for goods needing technical clearances.
India clarified its recent decision to allocate Tariff Rate Quotas (TRQ) for gold through a competitive bidding process. This move is designed to enhance transparency and provide more predictable market access for domestic jewellers who depend on gold imports from the UAE. Under the TRQ system, a set quantity of a product can be imported at a low or zero tariff, with higher taxes applied to imports beyond that limit.
Push for Smoother Trade and Market Access
New Delhi is advocating for smoother certification procedures and clearer, product-specific rules to help Indian exporters in vital sectors such as food products, engineering goods, pharmaceuticals, and textiles. The meeting was co-chaired by Ajay Bhadoo, Additional Secretary in the Indian commerce ministry, and Juma Al Kait, UAE's Assistant Under-Secretary for International Trade Affairs.
Experts highlight the strategic importance of this push. "For India, higher access to the UAE market is critical not only to boost exports, but also to leverage the UAE’s role as a re-export hub for Africa and West Asia," said Dattesh Parulekar, Assistant Professor of International Relations at Goa University. He added that a more effective CEPA could help Indian firms integrate into regional value chains and compete with suppliers from Southeast Asia.
Bilateral Trade Soars Past $100 Billion
The review comes at a time of remarkable trade growth. Bilateral trade surged by a fifth to reach $100.06 billion in the fiscal year 2025, solidifying the UAE's position as one of India's most crucial economic partners. This is a dramatic increase from the $43.3 billion recorded in FY21, before CEPA came into force.
According to the commerce ministry's data, India's goods exports to the UAE stood at $36.63 billion in FY25, while imports were significantly higher at $63.40 billion, resulting in a trade deficit of $26.76 billion. The UAE is now India's second-largest export destination after the United States.
Both nations are also chasing an ambitious target of $100 billion in non-oil and non-precious metal trade by 2030. The meeting also underscored the need for stronger regulatory cooperation, particularly in pharmaceuticals, where Indian companies seek faster approvals and simpler labelling rules.
With both countries committed to translating the pact into tangible benefits, the ongoing review of CEPA is a significant step towards unlocking its full potential for businesses and the broader economy.
