UAE Contemplates $50 Billion Investment in India, Awaits 2024 Election Season
In a promising move for economic collaboration between the United Arab Emirates (UAE) and India, the UAE is exploring the possibility of making a $50 billion investment in India.
The discussions revolve around potential investments in critical the South Asian nation's infrastructure projects and state-owned assets.
Notably, several of these investments could involve UAE sovereign wealth funds, including the likes of the Abu Dhabi Investment Authority, Mubadala Investment Co., and ADQ, according to sources with intimate knowledge of the matter.
The preliminary announcements regarding this significant investment are expected to surface early next year, a strategically timed move just ahead of Indian Prime Minister Narendra Modi's anticipated bid for a third term in the upcoming federal elections.
The United Arab Emirates and India have forged a robust economic partnership, with India ranking as the UAE's second-largest trade partner.
In the fiscal year spanning April 2022 to March 2023, the bilateral trade volume between the two nations reached an impressive $84.5 billion, as per official data.
The recent signing of the Comprehensive Economic Partnership Agreement (Cepa) has further fortified trade relations between the two nations.
A $50 Billion Investment in India
Furthermore, the UAE has risen to become the fourth-largest investor in India during the 2022-23 period.
Foreign direct investment (FDI) from the UAE, the Arab world's second-largest economy, surged from $1.03 billion in 2021-22 to a substantial $3.35 billion in 2022-23, according to official records.
Indian Prime Minister Narendra Modi has actively pursued closer ties with the UAE, having made five visits to the Gulf nation since taking office. His most recent visit occurred in July of the current year, involving critical meetings with UAE President Sheikh Mohammed bin Zayed.
The strategic goal shared by the UAE and India is to elevate their relations over the next decade, aiming to boost non-oil bilateral trade to a substantial $100 billion.
Adding to this promising investment climate, entities under the guidance of Sheikh Tahnoon bin Zayed Al Nahyan, the Deputy Ruler of Abu Dhabi, have initiated preliminary discussions regarding substantial investments in India.
Sheikh Tahnoon, who also serves as the chairman of International Holding Co., notably increased the stake in India's Adani Enterprises Ltd. to over 5% in October, following divestment from two Adani Group companies.
Bindu Rai / Zawya