Sheikh Mohammed bin Zayed’s Republic Day visit to strengthen trade ties with India

The visit will significantly strengthen economic and trade relations, leading to more investment flowing into India from the UAE.

The UAE Armed Forces will be taking part in the Indian Republic Day parade in New Delhi. Manish Swarup / AP Photo

MUMBAI // Business leaders are anticipating that the visit of Sheikh Mohammed bin Zayed, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the Armed Forces, to India, which starts on Tuesday, will significantly strengthen economic and trade relations, leading to more investment in India by the UAE.

Sheikh Mohammed is on a three-day trip and will be the chief guest at the country’s Republic Day celebrations in New Delhi.

The visit “is a testament to the strengthening ties between the two countries”, said Promoth Manghat, the chief executive of UAE Exchange, a remittances company headquartered in Abu Dhabi.

“We believe that this visit will foster the strategic partnership in select key areas, like trade and investment, energy and technology.”

The Minister of Economy, Sultan Al Mansouri, will be among a group of ministers who are also travelling to India, along with a delegation of business executives from the UAE.

Aditya Berlia, an executive board member of the Apeejay Stya and Svran Group, a fam­ily-run industrial and investment house in New Delhi, said the visit would be “pivotal” for India and UAE trade and investment ties.

“Calling someone to be chief guest at Republic Day is a big thing, and it’s usually an indication that whoever is being called is on the top agenda of the prime minister and the country,” Mr Berlia said. “It sends a serious message that India really wants to improve its connections to the UAE, and the UAE accepting the invitation really shows they are serious about moving with India to the next step.”

Indians make up the largest single nationality of expatriates in the UAE.

“India and Indians have always been a very integral part of the UAE fabric,” said Yusuffali M A, chairman of the UAE-based Lulu Group. He is part of the delegation.

“Initiatives such as Make in India, Digital India, Skill India, coupled with easing of FDI [foreign direct investment] norms, have made India a very lucrative market for investors the world over,” Mr Yusuffali said. “I am sure the business leaders of the UAE will get first-hand information about these initiatives during the various bilateral engagements that will take place during this visit.”

He said any agreements that come out of the visit would have a “positive impact on the future of Indo-UAE relations”.

The UAE is a major source of remittances for India.

Sudhesh Giriyan, the chief operating officer of remittances company Xpress Money, said “there is a great opportunity for new bilateral cooperation” and Sheikh Mohammed’s attendance as chief guest of the Republic Day celebrations “signifies that this is a truly important relationship”.

Mr Manghat said he expected “bilateral defence ties, sharing of intelligence and coordination with security agencies, which will strengthen efforts to counter terrorism and illegal channels of remittances”, as a result of Sheikh Mohammed’s visit.

Historic economic and trade ties between the two countries have been in focus of late, with India’s prime minister Narendra Modi visiting the UAE in 2015, which was followed by a visit to India by Sheikh Mohammed in February last year. Mr Modi is striving to boost FDI flows into India, to help with economic growth and to create more jobs for the country’s vast population.

Mr Modi’s trip resulted in a US$75 billion fund being announced by the two countries to invest in infrastructure in India.

Last week, India’s union cabinet approved a memorandum of understanding (MoU) between the UAE and India on bilateral cooperation in the road transport and highways sector, which will be critical in furthering investment plans. The cabinet also signed off on a MoU with the UAE for cooperation on small and medium-size businesses and innovation.

The two nations have highlighted plans to increase trade by 60 per cent by 2020.

Anwar Gargash, Minister of State for Foreign Affairs, and M J Akbar, India’s minister of state for external affairs, along with delegations, met last week in New Delhi to hold a “strategic dialogue” ahead of the visit.

The Indian government said the two sides discussed a range of issues, including cooperation in trade and investment, energy security and renewable energy, defence and security, space and information technology.

Sheikh Mohammed’s visit last year resulted in a raft of agreements between the two countries, including a framework to facilitate UAE investment in Indian infrastructure, cooperation in space exploration, renewable energy and skill development. Defence is another area where there is increasing collaboration between the UAE and India.

The UAE is a major supplier of crude oil to India and there will also be interest in the progress made on plans announced last year for Adnoc to store crude oil in India’s strategic reserves.

UAE companies that are investing in India include the ports oper­ator DP World, while Abu Dhabi’s Etihad Airways has a stake in the Indian carrier Jet Airways. India is also one of the UAE’s biggest markets for international tourists.

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