New Delhi: India and the United Arab Emirates (UAE) have formally launched negotiations for a Comprehensive Economic Partnership Agreement (CEPA), Commerce Minister Piyush Goyal said on Wednesday. The first round of CEPA talks will be held from Thursday (September 23). "Both sides will aim to conclude negotiations by December 2021 and sign a formal agreement in March 2022," Ministry of Commerce & Industry stated in a notification.
This was communicated at a joint briefing by Mr Goyal and his UAE counterpart Thani bin Ahmed Al Zeyoudi. "India and the UAE will hold talks aimed at improving bilateral economic relations, including expanding the existing trade and investment relationship," the ministry added.
In a joint statement, both the ministers emphasized that CEPA will create new jobs, raise living standards, and provide wider social and economic opportunities in both nations.
"A new strategic economic agreement is expected to increase bilateral trade in goods to $100 billion within five years of the signed agreement and increase trade in services to $15 billion," the statement read.
Currently, the UAE is India's third-largest trading partner with bilateral trade in 2019-2020 valued at $59 billion. The Arab nation is also India's second-largest export destination after the US, with exports valued at $29 billion in 2019-2020.
India was the UAE's second-largest trading partner in 2019, with bilateral non-oil trade valued at $41 billion. And, the UAE is the eighth-largest investor in India, having invested $11 billion between April 2000 and March 2021, while investment by Indian companies in the UAE is estimated to be over $85 billion.
In 2019-2020, India imported $10.9 billion of crude oil from the UAE.
In the joint statement, both the ministers underlined the need to coordinate and promote cooperation under the framework of the memorandum of understanding (MoU) signed in January 2017 between the two nations for cooperation on trade remedy measures.
Under a free trade agreement, two trading partners usually reduce or eliminate customs duties on the maximum number of goods traded. They also liberalize norms to enhance trade services and boost investments.