India which now accounts for 15 percent of bilateral trade with the United Arab Emirates superceded China in 2009 to become the UAE’s largest trading partner, according to a report by the government-controlled Emirates Industrial Bank (EIB). Accordingly China, the US, Germany, Japan, UK, Italy, Switzerland, France and Malaysia followed in trade value to the UAE, accounting for almost 60 percent of the total import of the country.
According to the report, bilateral trade between the UAE and India climbed to a record high of about Dh118bn (US$32 billion) in 2009. The UAE was also India’s second largest exporter recorded non-oil foreign trade worth US$17 billion (Dh62.44bn) after Saudi Arabia the UAE’s premier exporter. Similarly, from only Dh 9.2 billion (US$2.5 billion) in 2002, the UAE’s imports from India shot up to US$ 16.5 billion or 10.8 percent of India’s total exports of US$153 billion.
“There has been a noticeable shift in the trade of the UAE and other members of the GCC (Gulf Cooperation Council) with the West as the balance is gradually tilting towards Asia. This shift is extremely important for the Gulf’s future economy, including the monetary and fiscal policy, as well as the exchange rates and the Gulf single currency,” EIB said in its report.
Experts attribute this surge in bilateral trade to the decline in the dirham which is pegged to the US dollar and to a substantial trade agreements between the GCC and India and China. The EU has until now been reluctant to sign a free trade pact with the UAE and other Gulf Cooperation Council members.
India primarily exports gems and jewellery, vegetables, fruit, spices, engineering goods, tea, meat and its preparations, rice, textiles and apparel and chemicals to the UAE.