On February 18, India and the United Arab Emirates (UAE) signed one of the most comprehensive free trade agreements (FTA) ever. The India-UAE Comprehensive Partnership Agreement deal was signed during the virtual summit meeting between Prime Minister Narendra Modi and Crown Prince of Abu Dhabi, H.E. Sheikh Mohamed bin Zayed Al Nahyan. Expected to be operationalised by May, the India UAE FTA will see zero duty on $26 billion worth of Indian products that are subjected to 5% import duty by UAE at the moment. The UAE has offered overall duty elimination on over 97% of its tariff lines corresponding to 99% of India's exports in value terms over a 10-year period. However, 90% of India's exports will be at zero duty from day one of the entry into force of the agreement. Only 9% duty reduction will happen in a staggered manner. The sectors where duty free exports will come into force immediately include textiles, engineering products, gems and jewellery, pharmaceuticals, medical devices, plastics, leather and footwear, agricultural products, furniture, sports goods and automobiles. What does this mean for individual industry segments?


Over $2 billion additional exports are expected over the next five years. The institutional sale of home textiles like bed and bath linen and contact textiles like beach towels, salon and spa linen are expected to double

Engineering Products

Engineering exports, projected to reach $5 billion in 2021-22 are likely to grow 10% in the first two years and 15% in the next three years due to the FTA. Exports of engineering goods are projected at $7 billion, $8 billion and $9.2 billion for the year 2024-25, 2025-26 & 2026-27 respectively.

Gems and Jewellery

Import cost of raw materials will reduce due to India's tariff concession while exports of plain gold jewellery and gold studded jewellery will increase to $10 billion in 2023.


India will become a major raw material supplier to UAE's local pharmaceutical formulation industry. Provisions for automatic registration and marketing authorisation of Indian generic medicines in 90 days to facilitate India's export growth.


Additional increase in exports projected at $1.3 billion - $872 million in the short term & another $402 million in the long term expected. Tariff concessions offered to the UAE by India in products like Polyethylene and Polypropylene will reduce the import cost of inputs.


Projected increase in exports over five-year horizon is $160 million as the average per unit price for India manufactured vehicles will now reduce from $12,829 to $12,218

Leather & Footwear

Additional increase in exports projected at $130 million over next five years.

Agricultural Products

Additional increase in exports are projected at $850 million over next five years.

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