The economic relationship between the United Arab Emirates and India has entered a new phase. What was already a major trading relationship has expanded significantly since the two countries implemented their Comprehensive Economic Partnership Agreement (CEPA) in 2022.
In the financial year 2024-25, bilateral trade between India and the UAE crossed $100 billion, reaching $100.06 billion, according to India’s Ministry of Commerce and Industry. The figure represented a 19.6% increase from the previous year.
In January 2026, the two countries set a new ambition: to double bilateral trade to $200 billion by 2032. The announcement came during UAE President Sheikh Mohamed bin Zayed Al Nahyan’s visit to India and followed discussions between the two governments on trade, investment and economic cooperation.
The numbers show how quickly the relationship has developed. But the more important question for businesses is what is driving that growth and where the next opportunities may emerge.
CEPA Changed the Structure of Trade
The India-UAE CEPA came into force on May 1, 2022. It was designed to reduce tariffs, improve market access and create a broader framework for trade in goods and services, investment and economic cooperation.
The agreement has already coincided with significant changes in bilateral commerce.
India’s Ministry of Commerce and Industry reported that merchandise trade between the two countries increased from $43.3 billion in FY2020-21 to $83.7 billion in FY2023-24. Non-oil trade reached $57.8 billion in FY2023-24, accounting for more than half of total bilateral trade.
The latest figures suggest that the relationship has continued to expand.
In FY2024-25, bilateral trade reached $100.06 billion. The third CEPA Joint Committee meeting in November 2025 reviewed issues including market access, rules of origin, services, data sharing, standards and pharmaceutical regulations.
These discussions matter because trade agreements do not operate simply through tariff reductions. Companies also need clear rules and efficient procedures to move products and services across borders.
The $200 Billion Target
The next stage of the relationship is now tied to the $200 billion bilateral trade target for 2032.
The target was announced jointly by the UAE and India in January 2026 after bilateral trade had already crossed $100 billion. The two governments also highlighted initiatives intended to connect small and medium-sized businesses in both markets.
Reaching another $100 billion will require growth across multiple sectors rather than relying on one category of trade.
That is already reflected in the way the two countries are discussing their economic relationship.
The January 2026 joint statement referred to cooperation involving micro, small and medium enterprises, the Bharat Mart, the Virtual Trade Corridor and the Bharat-Africa Setu. These initiatives are intended to create additional channels for businesses to reach markets across the Middle East, West Asia, Africa and Eurasia.
This gives the UAE-India relationship a wider geographic dimension.
Indian Exports to the UAE Are Becoming More Diverse
The growth is not only about the value of trade. The range of products being exported is also changing.
India’s Ministry of Commerce reported in July 2026 that the number of Indian tariff lines exported to the UAE increased from 7,546 in FY2021-22, before CEPA, to 8,053 in FY2025-26.
That represents an increase of 507 tariff lines, or 6.7%. The value of exports across those tariff lines reached $37.3 billion in FY2025-26.
The data provides an indication of greater product diversification in India’s exports to the UAE.
India’s merchandise exports to the UAE under CEPA reached $37.36 billion in FY2025-26, according to India’s Ministry of Commerce and Industry.
The CEPA framework provides preferential access across a substantial share of tariff lines. India’s government states that the UAE provides preferential market access across 97% of its tariff lines, representing 99% of Indian exports by value.
For Indian businesses, that market access can be particularly relevant for sectors such as engineering products, chemicals, textiles, gems and jewellery, food products and other manufactured goods.
Services Are Part of the Next Opportunity
Goods are only one part of the India-UAE economic relationship.
The CEPA also includes provisions covering services, including business services, communications, construction, education, environmental services, financial services, healthcare, tourism and transportation.
This is important because both economies have substantial services sectors.
Indian companies have a large presence in areas such as information technology, professional services, healthcare, engineering and financial services. The UAE, meanwhile, is developing itself as a regional center for finance, logistics, technology and international business.
Greater cooperation in services could therefore create opportunities that do not appear in merchandise trade figures.
For businesses, the next phase of the relationship may increasingly involve professionals, digital services, technology companies and knowledge-based businesses alongside traditional exporters.
Investment Is Becoming a Second Pillar
Trade is not the only area where the two countries are strengthening their economic relationship.
The January 2026 joint statement noted that the Bilateral Investment Treaty signed in 2024 had strengthened investment flows across multiple sectors in both countries.
The investment relationship operates in both directions.
UAE-based investors have exposure to India’s large consumer market, infrastructure development, manufacturing, technology and other sectors. Indian companies, meanwhile, can use the UAE as a base for accessing the Gulf and wider international markets.
The UAE’s position as a global logistics and financial hub gives the investment relationship another layer.
An Indian company looking beyond its domestic market can use the UAE not only as an export destination but potentially as a regional business base.
Small Businesses Are Becoming More Important
Large corporations often dominate discussions around international trade, but the next phase of UAE-India economic cooperation also places attention on smaller companies.
During the January 2026 visit, the two governments called for stronger connections between MSMEs in both countries. They also highlighted the planned implementation of the Bharat Mart and Virtual Trade Corridor.
For smaller businesses, international expansion can be difficult because of logistics, market knowledge, regulatory requirements and finding buyers.
Trade infrastructure and digital platforms can potentially reduce some of these barriers.
This is particularly relevant as e-commerce and digital business models allow smaller companies to reach international customers without building a large physical presence in every market.
The UAE as a Gateway to Wider Markets
The relationship also matters because of where the two countries sit geographically.
India provides access to a large South Asian market, while the UAE has developed extensive commercial connections across the Gulf, Africa, Europe and other regions.
The two governments’ focus on initiatives such as Bharat-Africa Setu reflects this wider ambition. The January 2026 joint statement described these initiatives as ways to promote MSME products across the Middle East, West Asia, Africa and Eurasia.
This creates the possibility of a broader commercial corridor rather than a relationship based solely on two-way trade.
For companies, the value of such a corridor can come from access to multiple markets, logistics networks and business partners.
Trade Growth Comes With New Requirements
The growth of UAE-India trade also creates practical challenges.
As trade volumes increase, companies need efficient customs procedures, reliable standards, transparent rules of origin and clear regulatory processes.
The third CEPA Joint Committee meeting in November 2025 addressed several of these issues, including rules of origin, standards, pharmaceutical regulations, services and market access.
India’s Ministry of Commerce also reported that 445,000 Certificates of Origin had been issued under the India-UAE CEPA by July 2026, showing substantial use of the agreement’s preferential trade provisions.
Continued implementation will therefore be important as businesses seek to make greater use of the agreement.
What Comes Next for UAE-India Trade?
The first $100 billion milestone has changed the scale of the relationship. The next $100 billion will require deeper participation from businesses across goods, services and investment.
The data already shows some of the foundations for that expansion.
Trade has grown considerably since CEPA took effect. Indian exports to the UAE have become more diversified across tariff lines. Services are included in the agreement, investment ties have been strengthened through the bilateral investment treaty, and both governments are focusing more attention on smaller businesses and digital trade infrastructure.
The $200 billion target for 2032 therefore represents more than a larger trade figure. It provides a framework for the two economies to expand commercial connections across more sectors and markets.
For companies in India and the UAE, the opportunity will increasingly depend on how effectively they use these existing trade and investment frameworks.
The UAE-India economic relationship has already moved beyond a traditional buyer-seller model. Its next stage is likely to be shaped by investment, services, technology, MSMEs and access to wider regional markets.
That makes the partnership an important business corridor to watch as both countries work toward the next phase of their economic relationship.
