India’s revived discussions for concluding a Free Trade Agreement (FTA) with the UAE and other GCC countries are “progressing fast” and will enable the country to become a global trading hub, according to Piyush Goyal, the Minister for Commerce, Industry and Consumer Affairs.

Addressing a large cross-section of India’s business through the platform of the Jain International Trade Organisation, Goyal cited the UAE specifically as among the countries with which his Ministry is engaged in talks towards reaching an FTA.

Besides the GCC, India is conducting FTA-related talks with the UK, Australia and the European Union.

The India-GCC FTA talks, which started in 2004, were suspended in 2008, but with the active involvement of the UAE, they were revived again recently as both countries expect to see the two-way trade crossing the $100 billion-mark in the coming years from the current $60 billion given the stronger bilateral engagements in the wake of state-level visits by leaders of both countries. However, now the UAE and India have decided to work on a separate free trade pact as it would not need as much coordination.

The UAE is still the third-largest trading partner of India despite a dip in both exports and imports in 2020-21 due to the pandemic. India’s exports to UAE last fiscal were valued at $16.7 billion while imports from the country were at $26.6 billion. Nearly 8.0 per cent of India’s oil is also sourced from the UAE.

Home to 3.4 million Indian expatriates generating the highest remittances from abroad, the UAE is also among the top 10 investors in India with an estimated $11 billion in investments, more than half of which is in the form of foreign direct investment (FDI).

Goyal said the pace of discussions has now gathered speed. Traders and exporters are the “twin pistons powering the economic growth engine of India. We firmly believe in the capabilities of the business community as well as of start-ups.”

The FTAs will enable India to become a global “trading hub,” Goyal hoped.

The Jain International Trade Organisation is conducting a 12-day virtual expo with the participation of several thousand businesses and entrepreneurs.

An Indian government official has said India had revived the FTA talks with the UAE, its third global trading partner, with expectations of a larger pact with the other GCC countries taking place subsequently.

“As the UAE has been very keen to advance an FTA between India and the GCC, which has been pending for a long time, the two countries decided to first go ahead and work out a deal amongst themselves,” the official was quoted as saying. The initial talks have started on a virtual mode.

He said the GCC is of both economic and strategic interest to India as it had emerged as one of the largest trading partners. Its substantial oil and gas reserves is also of great importance for the country’s energy needs. Moreover, it is a source of increased foreign investments into India.

In FY21, India imported goods worth $80.5 billion from GCC countries, while exports amounted to $40.5 billion. About half this trade is with the UAE.

A Framework Agreement on Economic Cooperation between India and the GCC was signed in 2004 that provided for both parties to consider ways and means to extend and liberalise trade relations besides initiating discussions on the feasibility of an FTA. Two rounds of negotiations were held —in 2006 and 2008. The movement of natural persons is one of the four ways through which services can be supplied internationally. It includes the movement of natural persons such as independent professionals and is of key interest to India in its global trade relations.

India stands to gain in services as well and could push for long-term business visas with the UAE, experts said.

“We have a geographic advantage with that region and a lot of business travel happens. Long-term business visas will be beneficial for India,” said an expert on trade issues.

Easier movement of professionals, called Mode 4 in trade parlance, could also be among India’s demands, the expert said.

Source:https://www.khaleejtimes.com/business/economy/indias-fta-talks-with-uae-progressing-fastrsquo