Focus: GS2- International Relations
Why in News?
The Bilateral Investment Treaty (BIT) between India and the United Arab Emirates (UAE) signed on 13th February, 2024 at Abu Dhabi entered into force with effect from 31st August, 2024.
The enforcement of this new BIT with UAE gives continuity of investment protection to investors of both the countries
The Bilateral Investment Promotion and Protection Agreement (BIPPA) between India and UAE signed in December 2013 expired on 12th September, 2024.
India-UAE Relations:
- India and the UAE established diplomatic ties in 1972, with a significant enhancement in bilateral relations occurring during the visit of India’s Prime Minister to the UAE in August 2015, initiating a new strategic partnership.
- This partnership was further strengthened when the Crown Prince of Abu Dhabi visited India in January 2017, leading to the upgrade of bilateral relations to a comprehensive strategic partnership.
- This development spurred negotiations for an India-UAE comprehensive economic partnership agreement.
Economic Ties:
- In terms of economic relations, bilateral trade between India and the UAE reached USD 85 billion in 2022-23, making the UAE India’s third-largest trading partner and second-largest export destination.
- The goal is to elevate bilateral merchandise trade to over USD 100 billion and services trade to USD 15 billion within five years.
- Numerous Indian companies have established manufacturing units, either through joint ventures or in Special Economic Zones (SEZs), across various sectors in the UAE.
- Under India’s revamped Free Trade Agreement (FTA) strategy, the UAE holds a prominent position as the top priority for an early harvest deal, alongside other key countries/regions such as the UK, the EU, Australia, Canada, Israel, and the Gulf Cooperation Council (GCC).
- The UAE has also expressed its intent to pursue bilateral economic agreements with India and seven other countries.
