CROWN PRINCE OF ABU DHABI VISITS INDIA
His Highness Sheikh Khaled bin Mohammed bin Zayed Al Nahyan, the Crown Prince of Abu Dhabi, is on an official visit to India from September 9-10, 2024, at the invitation of Prime Minister Shri Narendra Modi.
KEY EVENTS
A. This marks Sheikh Khaled’s first official visit to India in his current role.
B. Upon arrival in New Delhi, he was welcomed by Shri Piyush Goyal, Minister of Commerce and Industry, and honored with a ceremonial Guard of Honour.
C. Sheikh Khaled is accompanied by a delegation of ministers, senior officials, and a prominent business group.
KEY HIGHLIGHTS
- Bilateral Discussions:
- Prime Minister Narendra Modi and Sheikh Khaled discussed the progress made in the India-UAE Comprehensive Strategic Partnership. They expressed satisfaction with the Comprehensive Economic Partnership Agreement (CEPA) and the recent implementation of the Bilateral Investment Treaty (BIT), which are set to further strengthen economic and commercial ties.
- The leaders explored new areas for collaboration, particularly in nuclear energy, critical minerals, green hydrogen, artificial intelligence, and advanced technologies.
- Signed Agreements and MoUs:
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- MoU on Nuclear Cooperation: Between Nuclear Power Corporation of India Limited (NNPCIL) and Emirates Nuclear Energy Corporation (ENEC). This agreement aims to improve cooperation in nuclear power operations, sourcing of nuclear materials, mutual investments, and capacity building.
- Agreement for Long-Term LNG Supply: An agreement between Abu Dhabi National Oil Company (ADNOC) and Indian Oil Corporation Limited (IOCL) for 1 million metric tonnes per annum (MMTPA) of LNG, enhancing India’s energy security. This is the third long-term LNG contract signed within a year.
- Production Concession Agreement for Abu Dhabi Onshore Block 1: Between Urja Bharat (a joint venture of IOCL and Bharat Petro resources Ltd) and ADNOC. This marks the first concession for an Indian company in the UAE, contributing to India’s energy security.
- MoU on Food Parks: Between the Government of Gujarat and Abu Dhabi Developmental Holding Company PJSC (ADQ). It involves developing food parks in Gujarat, with the project expected to start in Q2 2025.
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- MoU between ADNOC and India Strategic Petroleum Reserve Limited (ISPRL): Focuses on exploring ADNOC’s involvement in additional crude storage opportunities in India and renewing existing agreements.
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IMPORTANCE OF UAE FOR INDIA
- Strategic Political Partnership: The India-UAE relationship has been elevated to a ‘comprehensive strategic partnership’ with a ‘strategic security dialogue’, reflecting growing political alignment.
- Bilateral Trade: The UAE is India’s third-largest trading partner. The CEPA signed in 2022 has boosted trade significantly, with bilateral trade increasing from USD 72.9 billion (April 2021-Mar 2022) to USD 84.5 billion (April 2022-Mar 2023).
- Foreign Direct Investment (FDI): The UAE is the fourth-largest investor in India, with FDI rising to USD 3.35 billion in FY23 from USD 1.03 billion in FY22.
- Energy Security: The UAE is a key oil supplier and plays a crucial role in India’s Strategic Petroleum Reserve.
- Finance: The introduction of the RuPay card and Unified Payments Interface (UPI) in the UAE and the Local Currency Settlement (LCS) System highlight growing financial ties.
- Space Exploration: Collaboration between ISRO and the UAE Space Agency on space exploration.
- Defence and Security: Strengthened cooperation on counter-terrorism, intelligence sharing, and joint military exercises.
- Cultural and Diaspora Links: The large Indian diaspora in the UAE and cultural initiatives such as the Hindu temple in Abu Dhabi enhance bilateral ties.
- Cooperation During Covid-19: Collaborative efforts in healthcare during the pandemic.
- Multilateral Engagements: Participation in the I2U2 grouping and the India-Middle East-Europe Economic Corridor (IMEC).
CHALLENGES
- Limited Trade Diversification: Trade remains concentrated in a few sectors, limiting broader economic benefits.
- Rising Import Costs: Increased imports from the UAE impact the trade balance.
- Non-Tariff Barriers: Issues like Halal certification affect the export of processed foods.
- Human Rights Concerns: Migrant labor rights are significant issues.
- Diplomatic Balancing Act: Navigating regional conflicts and UAE’s financial support to Pakistan pose challenges.
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