The India-UAE Free Trade Agreeement (FTA) will come into effect after the United Arab Emirates completes the official processes on its side, said Commerce Secretary B.V.R. Subrahmanyam on Saturday.
At a press interaction, the official said the the FTA will ensure advantage for a wide range of exports and is likely to prompt Indian-owned gold and jewellery businesses to shift back to the country from foreign locations.
“The FTA-related work on our side has been completed. The work on the side of the UAE is yet to be completed. Every country has its own official processes and the UAE too has its own. We are expecting a maximum of 60 days before the Comprehensive Economic Partnership Agreement [CEPA] comes into effect,” said Mr. Subrahmanyam indicating that the entire process is likely to be concluded by May.
Commerce and Industry Minister Piyush Goyal had on Friday said India had completed the negotiations for the trade pact in three months adding that a similar pact is being discussed with the Gulf Cooperation Council region.
High–level remittances
The India–UAE economic ties are marked by high–level remittances that India receives from the citizens who work in the Gulf country as foreign workers. Mr. Subrahmanyam said the FTA will boost both trade and remittances.
“As Indian companies invest in the UAE after the FTA, they will create need for employees who will go from India and they will send back remittances. It will be a win-win situation in trade and remittances,” said Mr. Subrahmanyam who described remittances as a significant part of the ties.
The official highlighted that Indian jewellery will get zero duty access which will increase exports. The FTA which covers almost 90% of exports will make it more attractive for Indian companies to invest in export–oriented businesses because of zero-tariff facility that the UAE is expected to provide to Indian products.
“Indian jewellery in the UAE had 5% duty. The FTA [upon coming into force] will shift international businesses from Hong Kong and Singapore to India,” said Mr. Subrahmanyam highlighting the advantage of the FTA.
