Sign in
The UAE and India agreed to set up an India-UAE food corridor serving the UAE and neighboring regions by building food processing facilities and food parks in India, ANI News cites India’s Commerce and Industry Minister Piyush Goyal as saying at the India-UAE high-level task force meeting on investment in Mumbai. The UAE funneled an initial USD 2 bn commitment into the initiative.
The details: The investment will be geared towards building infrastructure — including food processing units and food parks — to support both Indian farmers and agribusinesses, and ramp up Indian agriculture exports to the UAE and the broader Middle East. The project is expected to be rolled out over two or two and a half years, with a small working group comprising Indian central and state governments, as well as UAE officials, formed to handle the project.
This has been in the works: “It has been under discussion for a very long time that UAE would like to invest in setting up food processing facilities in India to enable the availability of high-quality products suitable to the UAE taste in India using Indian farmers’ products and to be sold in the UAE,” Goyal said.
A PLAN TO RAMP UP INVESTMENTS?
The UAE to up FDI in India to USD 100 bn? India is reportedly in talks with the UAE to increase its foreign direct investments (FDI) in India to USD 100 bn, up from some USD 75 bn in commitments currently, The Hindu Times quotes Goyal as saying. This came alongside reports of India working to encourage UAE investments, the Abu Dhabi Investment Authority setting up shop in India, and more.
#1- India has made it easier for UAE investors to seek international arbitration if needed: India cut down by two years the local remedies exhaustion period for UAE investors under the countries’ bilateral investment treaty, which came into effect on 31 August, after being inked in February, Business Standard reports, citing a statement from India’s Finance Ministry. The treaty now mandates that UAE investors attempt to resolve disputes through India’s legal system for at least three years — down from the previous five-year duration — before seeking international arbitration.
India’s BIT with the UAE includes portfolio investments — stocks and bonds — as protected investments, deviating from the county’s model BIT, whose scope covers only direct investments, according to the statement.
Also covered: The treaty includes provisions for investment treatment, with an obligation for no denial of justice, no fundamental breach of due process, no targeted discrimination and no manifestly abusive or arbitrary treatment. It does not cover related to taxation, government procurement, subsidies, and fraud or corruption cases.
#2- The two also agreed to set up investment promotion offices in each other’s countries, with the UAE’s office set to be co-located with Invest India in New Delhi, ANI News said. India also plans to establish its first overseas campus of the Indian Institute of Foreign Trade in the UAE, starting with courses that will evolve into a full campus.
The Abu Dhabi Investment Authority (Adia) established a subsidiary at the Gujarat International Finance Tec-City (GIFT City), India’s tax-neutral finance hub, the sovereign wealth fund said in a statement (pdf). This came after Adia received regulatory approval from the International Financial Services Centre Authority in India.
Adia plans a gradual transfer of its Indian assets to the new arm: Adia — whose investments in India range from public and private equity to infrastructure — said it will gradually transfer some of its Indian investments to the new subsidiary.
Background- Adia first revealed its plan to launch a subsidiary in GIFT City last year. GIFT City offers 100% tax exemption for 10 consecutive years for companies establishing their operations there. The UAE is India’s largest Arab investor, with around USD 3 bn invested in the country in FY 2023-24, Reuters reports.
MORE TO COME?
The UAE and India also discussed ramping up bilateral cooperation in data centers and artificial intelligence, and co-investments in renewable energy and transmission infrastructure in India during the meeting.
The India-UAE joint committee is set to meet next week to address rising business concerns, CNBC TV18 reports, citing Goyal.
