Unlocking Full Potential for India-UAE CEPA: Pathways to Enhanced Bilateral Trade
Summary
The India–UAE Comprehensive Economic Partnership Agreement (CEPA), signed in February 2022 and operational from May 2022, has materially accelerated bilateral trade, investment and services links. Non-oil trade soared to $37.6 billion in the first half of 2025 (up 33.9% year-on-year) and overall merchandise trade nearly doubled from $43.3 billion in FY2020-21 to $83.7 billion in FY2023-24. Key export winners for India include gems & jewellery, pharmaceuticals, fruits & vegetables and electronics; UAE initiatives such as the Food Security Corridor and Bharat Mart have supported flows the other way.
CEPA spans 18 chapters (goods, services, investment, digital trade, IP, procurement, MSME support) and delivers preferential or duty-free access on a large share of traded products. Beyond tariffs, the pact facilitates temporary movement of skilled workers and includes provisions for digital trade, SMEs and emerging sectors like renewables.
Key Points
- CEPA removed or reduced tariffs on over 80% of traded products and broadened services and investment access between India and the UAE.
- Bilateral merchandise trade nearly doubled to $83.7bn (FY2023-24); non-oil trade reached $37.6bn in H1 2025 (+33.9% YoY).
- Sectors with strong post‑CEPA gains: gems & jewellery (+64%), pharmaceuticals (+39%), fruits & vegetables (+35%), and electronics (smartphone exports ~ $2.57bn in FY2023-24).
- MSMEs are benefiting: India issued 122,000+ Certificates of Origin in FY2024-25 (supporting ~$19.87bn of exports); UAE MSME certificates rose 10.3% year-on-year (June 2024–June 2025).
- Investment flows and joint projects (e.g. UAE’s $2bn for Indian food parks) are strengthening supply‑chain resilience and enabling re‑exports to Asia and Africa via UAE hubs.
- Persistent barriers: regulatory misalignment (SPS/technical standards), logistics and infrastructure gaps, transshipment misuse concerns, limited deep collaboration on high‑value digital/tech sectors, and under‑utilisation of CEPA benefits by smaller firms.
- Recommended fixes: regulatory harmonisation, joint logistics corridors, digital customs and blockchain certificates of origin, expanded MSME capacity building and startups support, explicit green‑trade provisions and streamlined investment facilitation.
Context and Relevance
CEPA sits at the intersection of two strategic goals: India’s export diversification and industrial growth ambitions, and the UAE’s pivot from oil to a knowledge‑and‑services economy. For logistics, trade and policy professionals the pact is not just about tariff lines — it reshapes supply chains, re‑routes flows through Gulf hubs, and creates new market opportunities for MSMEs and green tech.
As global trade faces fragmentation and protectionist pressures, a well‑executed CEPA could catalyse a $100bn non‑oil India–UAE trade corridor by 2030. Fixing non‑tariff barriers, investing in cross‑border infrastructure and embedding sustainability targets will determine whether the agreement is a short‑term trade boost or a long‑run blueprint for resilient bilateral integration.
Recommendations (brief)
- Convene focused CEPA review summits with industry bodies (CII, FICCI, UAE Chambers) to draft addendums for AI, fintech and green tech.
- Develop dedicated logistics corridors and digital customs links; pilot blockchain certificates of origin for faster clearance and traceability.
- Scale MSME support — simple online CEPA compliance portals, subsidised trade missions and training hubs.
- Embed measurable sustainability clauses and joint renewable investment funds (solar, hydrogen, water management).
- Expand the CEPA Council’s mandate to include expedited dispute resolution and utilisation analytics for adaptive policymaking.
Why should I read this?
Quick version: CEPA has already blown past early expectations and changed trade flows — but it still has obvious holes you need to know about. If you work in exports, logistics, trade policy or supply‑chain planning, this article tells you where the gains are, what’s blocking them and the practical moves that could turbo‑charge business opportunities between India and the UAE. Saves you a deep-dive — but gives you the pointers you actually need.
Author style
Punchy: this piece cuts through headline numbers to show both the wins and the real bottlenecks. For policy makers and industry leaders it’s essential reading — the suggested fixes aren’t vague; they’re tactical and actionable. If you care about trade volumes, MSME access or building greener, tech‑enabled supply chains, read the detail.
