Trade Corridor
India and the United Arab Emirates (UAE) sealed a historic agreement on Tuesday, establishing a trade corridor set to link Europe with India via parts of the Middle East through sea and rail routes. This ambitious initiative, endorsed by the United States and the European Union, marks a significant step in enhancing regional connectivity and fostering economic cooperation.
The visit of Indian Prime Minister Narendra Modi to the UAE precedes India’s upcoming national elections, scheduled to commence in April. Modi’s agenda includes inaugurating the Middle East’s largest Hindu temple and addressing a massive expatriate gathering in Abu Dhabi, emphasizing engagement with the Indian diaspora.
The primary focus of the visit centers on energizing the diaspora, despite the fact that expatriates in the UAE cannot vote from abroad. With approximately 3.5 million Indian nationals, the UAE hosts the largest Indian expatriate community in the Gulf.
During his visit, Modi met with UAE President Sheikh Mohamed bin Zayed Al Nahyan, marking their fifth meeting in eight months. Several agreements were signed, including a bilateral investment treaty, building on the Comprehensive Economic Partnership Agreement inked in 2022.
The highlight of the diplomatic engagement is the India-Middle East Economic Corridor, proposed in September during the G20 summit in New Delhi. This corridor aims to extend from India, traversing the Arabian Sea to the UAE, through Saudi Arabia, and connecting to Europe via Jordan and Israel. Notably, the official statement did not reference any countries beyond India and the UAE, indicating that the corridor’s regional ambitions are still unfolding.
Amid regional complexities, including the conflict in Gaza and Yemen’s Houthi attacks affecting Red Sea shipping, the agreement underscores both nations’ commitment to advancing the corridor plan. The framework agreement also carries geopolitical significance, potentially challenging China’s global infrastructure strategy.
As Modi addresses the Indian diaspora and participates in key events, his seventh visit to the Gulf state further solidifies India’s robust ties with the UAE, a vital trading partner. The agreements signed during this visit signal the commitment to economic cooperation and regional connectivity between India and the UAE.
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