Prime Minister Narendra Modi’s arrival in Abu Dhabi on 16 August 2015 — the first by an Indian leader to the UAE in 34 years sparked the ignition of one of the world’s most dynamic bilateral relationships.
The landmark visit offered a glimpse into how one of the world’s fastest growing major economies would reshape and recalibrate its trade and diplomatic engagements with the rest of the world, setting the stage for a remarkable decade of transformation to emerge as a global economic powerhouse.
Today, as India celebrates its 79th year of independence, it stands as the fourth-largest global economy, its rise intertwined with deepening alliances such as with the UAE, and powered by manufacturing, green technologies, artificial intelligence, and space leadership.
Modi’s Landmark Visit
On the eve of that 2015 visit, in an interview with media, Modi declared: “UAE and India are top priority for each other,” signalling a new era of engagement. Over the decade that followed, he returned six more times, each visit unlocking fresh avenues in trade, investment, energy, technology, and cultural diplomacy.
CEPA: A Watershed Moment
In February 2022, the signing of the Comprehensive Economic Partnership Agreement (Cepa) became a turning point. Implemented in May that year, Cepa was designed to lift annual non-oil bilateral trade from about $60 billion to $100 billion. By financial year 2024-25, the goal was surpassed, with total trade reaching $100.06 billion, up from $72.87 billion in 2021-22. Non-oil trade alone hit $65 billion in 2024 — almost double the 2020 figure. Cepa’s sweeping tariff eliminations — 97.4 per cent of UAE tariff lines and 80 per cent of Indian tariff lines have unlocked high-growth sectors from telecom and healthcare to financial services and tourism. The UAE’s foreign direct investment into India has tripled to $3.35 billion in 2022-23, making it India’s fourth-largest investor, while cumulative two-way investments now stand at $25 billion.
As UAE Minister of Economy Abdulla bin Touq Al Marri observed in the context of Cepa: “A lot of trade is coming. A lot of B2B relationships are pushing partnerships to the next level.” That sentiment resonates far beyond the UAE–India corridor, capturing India’s broader economic aspiration: partnerships — both domestic and international will be central to its leap from $4 trillion to $10 trillion.
People-to-People Bonds
Beyond commerce, the relationship is sustained by deep social and cultural ties. Over four million Indians live in the UAE, forming both an economic backbone through remittances and a cultural bridge between the nations. The opening of the BAPS Hindu Mandir in Abu Dhabi in 2024, attended by Modi, underscored the commitment to interfaith harmony.
The partnership has expanded into future-focused arenas: Bharat Mart in Jebel Ali, the Virtual Trade Corridor, real-time rupee payments via UPI, fintech collaborations, and innovation pilots such as MagRail. Together, these initiatives are turning the UAE–India corridor into a model for digital-first, logistics-smart, regulation-light trade.
India enters its 79th year with GDP above $4 trillion and a clear ambition to more than double that figure to $10 trillion within 10–12 years. The growth roadmap rests on five pillars: scaling up manufacturing under Make in India and the Production Linked Incentive (PLI) schemes; leading the green energy transition; cementing global dominance in digital and AI; advancing space and frontier technologies; and diversifying exports into high-value, high-tech sectors.
Manufacturing Momentum
Manufacturing gross value added has grown at 7–8 per cent annually over the past decade, fuelled by sectors such as semiconductors, defence, electronics, and renewables. Reforms — ranging from reducing compliance burdens to introducing the National Logistics Policy and expanding ports and highways — are designed to lift manufacturing’s share of GDP from 17 per cent today to 25 per cent by 2030.
Green Growth Leadership
India has pledged net zero by 2070 and aims for 500 GW of renewable capacity by 2030. Already the third-largest renewable energy producer globally, it boasts some of the world’s lowest solar tariffs. The green hydrogen mission, with over $20 billion in planned investment, positions India as a future leader in global supply, reducing fossil fuel imports while opening lucrative export markets in green technology.
AI, Digital and Space Frontiers
India’s digital infrastructure — UPI, Aadhaar, ONDC is now a global benchmark. The AI mission targets placing India among the world’s top three AI hubs by 2030, with applications across healthcare, agriculture, climate, and manufacturing automation. Billions are flowing into AI, fintech, SaaS, and deep-tech startups, while global majors expand AI research and chip design centres in Indian tech hubs.
In space, the Chandrayaan-3 lunar landing in 2023 and the Aditya-L1 solar mission cemented India’s elite status. The upcoming Gaganyaan human spaceflight and a flourishing private space tech sector are expected to push the industry to $40 billion by 2040.
Tariff shock and the Opportunity Ahead
Yet India’s growth path faces immediate turbulence. US President Donald Trump’s sweeping new tariffs — an additional 25 per cent duty on Indian exports to the US have doubled tariffs on some goods to 50 per cent, targeting sectors such as leather, chemicals, textiles, gems and jewellery, and shrimp. With the US accounting for over 17 per cent of India’s merchandise exports, the impact is significant.
Economists, however, see this as a potential inflection point. “Tariffs will hurt in the short term, but they also force exporters and policymakers to fast-track competitiveness reforms,” said Anil Chaturvedi, trade economist and former WTO negotiator.
Reinventing Competitiveness
The government is moving swiftly to counter the blow: accelerating free trade agreements with the UK, EU, and GCC; offering targeted relief and credit to affected sectors; fast-tracking skills development; and incentivising domestic value-addition to cut import dependencies. These measures align with the Atmanirbhar Bharat vision — making India resilient and agile in global trade while reducing exposure to unilateral policy shocks.
Self-reliance Meets Globalisation
The strategy blends domestic manufacturing strength with aggressive market diversification into Latin America, Africa, Central Asia, and Southeast Asia. This could offset US market losses, while robust domestic consumption — now 60 per cent of GDP provides a growth cushion.
The Road Ahead
To reach the $10 trillion target, India must sustain 7–8 per cent growth annually, expand infrastructure at scale, deepen capital markets, and stay shock-resilient. Its demographic dividend, digital foundations, global diaspora, and reform momentum give it a distinct edge.
