Context

The historic India-UAE Comprehensive Economic Partnership Agreement (CEPA) which was signed on February 18, 2022 and came into force on May 1, 2022, has completed one successful year.

What is India-UAE Comprehensive Economic Partnership Agreement (CEPA)?

• The Comprehensive Economic Partnership Agreement (CEPA) was signed between India and UAE to strengthen the trade ties between the two nations. 
• Aim: The agreement aimed to increase the total value of bilateral trade in goods to over US$100 billion and trade in services to over US$ 15 billion within five years.
• The historical India-UAE CEPA is the first bilateral trade accord concluded by the UAE and India's first bilateral trade agreement in the Middle East/North Africa (MENA) region.
• India-UAE CEPA is a wide-ranging agreement, covering all aspects of India's economic engagement with the UAE including Trade, Investments, Healthcare, Digital Trade Government Procurement, IPR etc.

What are the impacts?

• This was the Fastest Executed Bilateral Agreement where imports and exports increased between India and United Arab Emirates (UAE).
• Benefit to domestic markets: The agreement also boosted trade which benefited the domestic market.
• Labour-intensive sectors also boomed as a result of this tie-up. 
• Increased exports: India’s global export rose by 5.3 per cent and exports to UAE increased by 11.8 per cent.
  • Major commodities: While the export of commodities like jewelry, car, and beauty products rose, in particular - aircrafts, spacecrafts and exports of parts increased by 4859 per cent as UAE is a transit hub between Asia and Europe and Americas.
• Increased imports: Similarly, imports also increased from the UAE by 18.8 per cent. The nation’s non-oil import from UAE increased by 4.1 per cent and global imports increased by 7.8 per cent.