UAE Signals $25 Billion Additional Investment in India to Deepen Ties and Expand Local Currency Trade
Ambitious Investment Plans Targeting $100 Billion
The UAE has expressed its intention to inject an additional $25 billion into the Indian economy in the near future, according to India’s Commerce and Industry Minister Piyush Goyal. The move aims to strengthen economic partnership and expand the use of national currencies in bilateral trade. Having already invested around $25 billion—making it India’s seventh-largest FDI source—the proposed capital could lift total UAE investments in India to $50 billion in the near term, with an ultimate target of $100 billion.
Diversified Target Sectors
Goyal made the remarks in Mumbai after co-chairing the 14th meeting of the India-UAE High-Level Joint Task Force on Investments alongside Sheikh Hamed bin Zayed Al Nahyan, Managing Director of the Abu Dhabi Investment Authority (ADIA). Discussions highlighted strong investment appetite across several key sectors, including ports, shipbuilding, space technology, startups, and Indian equity markets.
Advancing Local Currency Settlement Mechanisms
Both sides reviewed progress made by their central banks regarding local-currency trade settlements, the integration of payment and messaging systems, and central bank digital currencies (CBDCs). Goyal noted that local-currency settlement is gaining momentum, allowing Indian exporters to be paid in rupees and imports from the UAE to be settled in dirhams, thereby reducing reliance on the US dollar. Surplus currency balances can be converted into US dollars after three to six months to ensure smooth liquidity management.
Broad Cooperation and Doubling Trade Targets
Beyond financial investments, the two nations explored opportunities in logistics, energy, taxation, market access, fintech, food security, agritech, and artificial intelligence. This push comes as bilateral trade doubled to approximately $100 billion since the India-UAE Comprehensive Economic Partnership Agreement (CEPA) took effect four years ago. Both countries now aim to double bilateral trade again to $200 billion by 2032.
Key Recent Deals and Aviation Expansion
Recent major UAE investments in India include Emirates NBD’s acquisition of a 60% controlling stake in RBL Bank for around $2.75 billion, and Abu Dhabi-based International Holding Company’s (IHC) $1 billion investment for a 41.5% stake in Sammaan Capital. The meeting also covered civil aviation cooperation to enhance air connectivity and evaluated investment opportunities to develop an aviation and logistics hub at Dholera in Gujarat.