India’s non-petroleum exports increased at a comparatively slower rate than exports of refined petroleum products to the West Asian country a year after the United Arab Emirates (UAE) and India’s free trade agreement (FTA) went into effect. According to data from the ministry of commerce and industry, non-oil exports increased by 3% to $22.95 billion from May 2022 to April 2023, while total shipments to the UAE increased by 9.5% to $30.98 billion.
Exports of refined petroleum goods to the UAE increased by 17.8% to $7.52 billion during the same time period. The demand for goods like gold jewellery and electrical apparatus and equipment was the main driver of the increase in exports. According to data from the ministry of ommerce and industry, India’s non-oil exports to the world fell by 3.37 percent to $346.26 billion during the same period. In light of the weakening global demand brought on by the downturn in places like North America and Europe, India’s exports to the UAE performed better than average.
In terms of value, the trade agreement is anticipated to benefit close to 90% of India’s exports. Over 97% of the UAE’s tariff lines, or 99% of India’s exports in terms of value, have all of their duties eliminated. India’s second-largest export market is the United Arab Emirates.
Indian exporters were given instant access to duty-free markets in labour-intensive industries including furniture, textiles, gems and jewellery, leather, footwear, and footwear. Except for the ems and jewellery industries, no other sectors have experienced significant growth.
India has a $30 billion trade imbalance for FY2023, but this shouldn't alarm us because the UAE has a small industrial base and 79% of its imports are crude oil, petroleum products, gold, or rough diamonds.
Government representatives stated that moving forward, non-oil commerce will be the main focus. By 2030, the two nations intend to double non-petroleum trade from $48 billion to $100 billion.