UAE-India ties are growing stronger in more than one key area

Sheikh Khaled bin Mohamed, Crown Prince of Abu Dhabi, with India’s Prime Minister Narendra Modi in New Delhi, on September 9. EPA

In the past two weeks, Arab Gulf countries have engaged in intense diplomatic contacts with major and emerging powers. The strategic debates between Gulf Co-operation Council (GCC) countries and Russia, India and Brazil, held in Saudi Arabia, were a key part of this dynamic momentum.

Notably, Sheikh Khaled bin Mohamed, Crown Prince of Abu Dhabi's visit to India – his first since being named Crown Prince last year – marked a significant milestone. In addition, the UAE-India Business Forum, convened in Mumbai has added more empowerment, progress and elaboration to this momentum. The theme of the forum was “Beyond the Comprehensive Economic Partnership Agreement: innovation and future-ready economies”.

Earlier this month, President Sheikh Mohamed met Chinese Premier Li Qiang in Abu Dhabi. The meeting of the two leaders focused on the comprehensive strategic partnership between the UAE and China. Their discussions explored opportunities to enhance co-operation in various sectors, including investment, trade, economy and culture. Such engagements are of paramount importance, as China is the UAE’s largest trading partner globally.

In parallel, Saudi Crown Prince Mohammed bin Salman met with Russian Foreign Minister Sergey Lavrov in Riyadh on Monday. In a news conference, Mr Lavrov said the two sides discussed bilateral co-operation, adding that Moscow has extended an invitation to the Saudi Crown Prince to take part in the Brics summit next month, in the Russian city of Kazan.

Mr Lavrov emphasised the increasing importance of the group, which has grown from five to 10 member countries. He noted that other countries have expressed interest in joining Brics, describing this as an “essential driving force for expansion”.

Meanwhile, Sheikh Khaled's visit to India aimed to explore opportunities to elevate the UAE and India's strategic partnership to new heights, under the framework of their Comprehensive Economic Partnership Agreement, which came into force in May 2022. Both countries have signed agreements for the long-term export of liquefied natural gas, as well as co-operation in civil nuclear energy, green hydrogen and the application of the state-of-the-art innovative technologies in the food industry.

The UAE is trying to further strengthen co-operation with India across several areas of mutual interest, with a focus on digital health care, pharmaceutical research, biotechnology, genome medicine, renewable energy, sustainability, AI, logistics, supply chains, agricultural technology, strategic minerals and more.

It is clear that the two countries are committed to preparing for the future and actively contributing to shaping its contours.

Indian media highlighted the soft launch of the India-UAE Virtual Trade Corridor and the use of the interface Maitri (Master Application for International Trade and Regulatory Interface) to facilitate this initiative. Sources said this corridor will be part of the India-Middle East-Europe Economic Corridor – or Imec.

In the broader context, it becomes evident that the diversification strategies of the UAE and the GCC are not merely aimed at strengthening their positions with the US and European countries. Rather, they represent a long-term approach that takes into account the evolving dynamics of regional and international strategic environments, shifts in GCC interests, priorities over the past two decades and changes in the structure of the global economy and trade patterns.

In this sense, the Gulf has become a key hub in the Chinese Belt and Road Initiative, which has intensified interest among Gulf countries seeking to get Chinese investments. In recent years, Gulf investments have diversified towards the East, moving away from traditional western capital markets and real estate investments.

However, Gulf countries may still be affected by increasing tensions in the South China Sea, as disruptions in this region could affect the global flow of oil. According to the China Power Project at the Centre for Strategic and International Studies, an estimated $3.4 trillion in trade passed through the South China Sea in 2016, representing a sizeable portion of international trade – between 21 per cent and 36 per cent of the total global trade in 2016.

Meanwhile, experts have discussed the “Asianisation of Asia”, and similarly, we can talk about the “Asianisation of the Gulf region”, particularly in light of the substantial trade and oil exchange between countries in the region – including Iran and Iraq – and key Asian powers. This raises important questions about the role that Gulf countries may play in shaping a new international order, the future of global trade and issues of globalisation and energy security.

For GCC states, the BRI and Imec are not conflicting initiatives; rather, both provide the Gulf with advantageous business opportunities. Imec offers two immediate – and symbolic – outcomes for the Gulf.

First, it enhances the geo-economic and geo-strategic significance of Saudi Arabia and the UAE in global trade routes and security. Both China’s BRI and the newly announced Imec position the Gulf region as a critical hub in global economic networks.

Second, the envisaged corridor aligns with Saudi and Emirati economic and power ambitions, offering new post-oil diversification opportunities that support the implementation of their respective national vision programmes. From a political perspective, the already influential GCC states are set to become central players in shaping international policy and decision-making.

Last year, India hosted the G20 Summit, where New Delhi aimed to build a global consensus on economic issues and enhance North-South understanding and connectivity. India views itself as a representative of both worlds and seeks to make the global economy more open. It also aims to enhance ties and partnerships with various major world powers: the US, China, Russia and Japan.

As part of its “Think West” policy, India has worked to diversify its partnerships, particularly enhancing its economic and security ties with the Gulf region. For India, Imec is not about competing with China’s BRI, but rather about fostering economic growth, partnerships and integration on key issues such as trade, technology, food security and climate change, beyond mere geopolitical and security concerns. Notably, both China and India are members of major multilateral groups such as Brics and the Shanghai Co-operation Organisation.

The militarisation of the world order is not in the best interest of emerging countries and rising economic powers. A key question raised at the 10th Abu Dhabi Strategic Debate in 2023 is whether India will be drawn into the US strategy to reshape the security structure of the Pacific region, or whether New Delhi will maintain a safe and balanced stance amid Chinese-American competition. The answer will unfold in the coming years. In this context, India, alongside Gulf and other nations, could play a pivotal role in reducing divisions within the international order and between the North and South.