To enhance trade relations, India and the United Arab Emirates on Friday entered into a Comprehensive Economic Partnership Agreement (CEPA).
The agreement to boost bilateral trade is expected to be implemented within 60 days and entails enhanced market access and reduced tariffs.
It is expected that the CEPA will lead to an increase in bilateral trade from the current $60 billion to $100 billion in the next 5 years.
Earlier in the day, Prime Minister Narendra Modi virtually met the Crown Prince of Abu Dhabi and Deputy Supreme Commander of the United Arab Emirates (UAE) Armed Forces Sheikh Mohamed bin Zayed Al Nahyan and both leaders witnessed the signing of the CEPA.
"It is noteworthy that such an important agreement has been concluded in a record time of less than 3 months. Such agreements generally take years for conclusion," the Prime Minister said.
"The agreement demonstrates the deep friendship, shared vision and the trust between the two countries. I am confident that this will usher in a new era in our bilateral economic relations and the bilateral trade volume will increase from $60 billion to $100 billion in the coming 5 years."
Sheikh Mohamed bin Zayed Al Nahyan said: "The historic economic agreement demonstrates the commitment of our leaders to the bold Projects of the 50, launched in our pursuit of the next 50 years of progress and prosperity.
"This deal promises to provide significant benefits to UAE and Indian businesses, including reduced tariffs and enhanced market access, while also breathing new life into trading corridors from Africa to Asia and laying the foundations for growth and prosperity that will benefit the entire region."
The India-UAE CEPA is the first bilateral trade accord concluded by the UAE, and it is also India's first bilateral trade agreement in the MENA region.
At a press briefing post signing the deal, Commerce and Industry Minister Piyush Goyal said that India-UAE CEPA was negotiated in one of the quickest time frame of 88 days.
He said that the UAE will gain benefits in sectors such as gems and jewellery, textiles, leather, footwear, sports goods, furniture, agricultural products, pharmaceuticals, medical devices, automobile products, among others, whereas India would get benefits in metals, minerals, petrochemicals and petroleum sectors.
The agreement is expected to come into effect in the next 60 days, while the bilateral goods and merchandise trade is expected to increase to $100 billion in the next five years, Goyal said.
Besides, he said that CEPA would generate 10 lakh jobs across multiple labour-intensive sectors.
Furthermore, Goyal said that there were many firsts in the CEPA agreement.He pointed out that UAE had agreed to automatic registration and market authorisation for Indian medicines in case of their regulatory approval in developed countries such as the US, the EU, the UK and Japan.
In addition, the minister said that the agreement had a permanent safeguard mechanism which can be resorted to in a situation of sudden surge in imports, along with strict rules of origin, which will prevent products from other countries through the CEPA route.
