India is one of the largest trade partner for the UAE and the second largest supplier to UAE after China. Bilateral trade reached US$ 72.9 billion in 2021-22 from around 50 billion in 2017-18, however mainly due to rise in imports. Merchandise exports to UAE is marginally behind the pre-pandemic level at USD 28 billion. The India-UAE Comprehensive Economic Partnership Agreement (CEPA) is estimated to take bilateral trade between India and the UAE to US$100 billion by 2030.
In engineering, UAE remains among the top three export destination for Indian engineering products with a share of around 5.5 percent in India's global engineering exports. India's engineering exports top UAE has increased over the years from USD 4 billion in 2016-17 to US$ 5.6 billion in 2021-22, registering a CAGR of 6.6%. During 2021-22, India's engineering exports to UAE recorded a growth of more than 74% over the previous year. Major engineering products exported to UAE from India include Iron and Steel, Ships, Boats and Floating Structures, Products of Iron and Steel, Electric Machinery and Equipment, Motor Vehicle/cars, Industrial Machinery for dairy, agriculture, food processing, textiles, paper, chemicals, etc.
UAE is one of the top three destinations for exporting Indian engineering products. Engineering products therefore, is always on a high demand in the UAE. Moreover, India and signed an FTA with UAE called Comprehensive Economic partnership Agreement a few months back that will further strengthen the bilateral trade and investment relation between these two nations and Indian businesses will certainly have much more avenues to exploit in the UAE including engineering. This agreement will also act as a gateway for India to expand businesses in Gulf region, Central Asia and a part of Africa that had not yet been so smooth for India to penetrate. UAE have adopted an industrial strategy called 'Operation 300 bn' with an aim to develop the UAE's industrial sector and enhance its role in stimulating the national economy. India, as one of the major suppliers of engineering products is likely to have an instrumental role to play.
In case of construction and building material which is the focus product of the Big 5, India's export to UAE is 140.6 million in 2021-22, registering a phenomenal growth of almost 90.0% vis-a-vis 2020-21. Construction industry in the UAE is expected to grow by a CAGR of 4% in the next 4-5 years. Despite of projected growth not being so impressive, it is expected to be steady in the next few years that may bring opportunity for trade and investments for Indian businesses.