India announced plans to double bilateral trade with the UAE to $200 billion by 2032, in a move to diversify its partnerships, as a deal with the Asian country’s largest trading partner remains elusive.
During a three-hour-long meeting on Monday between the UAE’s President Sheikh Mohamed bin Zayed Al Nahyan and Indian Prime Minister Narendra Modi in New Delhi, both nations’ state-owned firms signed a 10-year liquefied natural gas supply agreement.
As per the deal, the Abu Dhabi National Oil Company, owned by the Abu Dhabi government, will be providing LNG to the value of up to $3 billion over 10 years starting in 2028, to the state-owned Hindustan Petroleum Corporation of India.
In a release, ADNOC said that this agreement has turned India into the largest LNG buyer of the UAE and will produce 20 percent of sales by 2029. Prime Minister Modi wrote in a post on X (formerly known as Twitter), Both countries also discussed ‘a wide range of issues aimed at further strengthening the multifaceted India-UAE friendship.”
Vice President for Studies and Foreign Policy at New Delhi-based think tank Observer Research Foundation, Harsh Pant, informed CNBC’s Inside India, “It was a productive visit in terms of outcome.”
He stated that India-UAE ties have evolved to a point where “regular high-level interaction at relatively short notice is going to become more common.”
The UAE-India trade reached $100 billion in the fiscal year 2025. Both countries entered into the Comprehensive Economic Partnership Agreement in 2022.
According to the India Brand Equity Foundation, an initiative backed by the commerce ministry, the second largest trading partner of the Middle Eastern country is India, which contributes to almost 9 per cent of its total trade as well as 14 per cent of its non-oil exports as of September 2025.
However, the UAE is the third top trading partner to India after the U.S and China in the fiscal year 2025 and is the home to 3.5 million Indian expatriates.
The decision of India to expand trade with the UAE is expected to happen during the period when the exports of the country to the U.S. are being strained due to the 50 percent tariff imposed by Washington on Indian goods since August last year.
“Even with a trade deal [with the U.S.], there is no guarantee that President Trump’s unpredictability would end,” said Pant, citing that it is the reason that India has been finalizing trade agreements with other countries.
Thus, after the U.S. tariffs, India signed trade agreements with the UK and Oman last year and indicated it will sign an agreement with New Zealand in the first half of 2026.
