Blitz Bureau
NEW DELHI: Bilateral trade with the United Arab Emirates reached $101.25 billion in FY 2025-26, the second consecutive year above $100 billion. The two governments have set a $200 billion target for 2032. Nobody has published what that requires: 12.0 per cent compound growth, every year, for six years.
Run the compounding. Moving from $101.25 billion in FY 2025-26 to $200 billion by 2032 is a multiple of 1.975 over six years, which needs a compound annual growth rate of 12.0 per cent. That is a demanding but not fanciful number: it is roughly what the corridor delivered in the first two years after the Comprehensive Economic Partnership Agreement entered into force in May 2022, and materially above what global merchandise trade has grown at over the same period.
The gateway: Jebel Ali, Dubai — the largest container port in the region and the principal transhipment point for Indian goods moving into West Asia, East Africa and beyond. A substantial share of India’s non-oil exports to the UAE is re-exported from here.
Two-thirds of a $101 billion relationship is now non-oil. That is the number that turns an energy supplier into a trading partner.
At a Glance
• Bilateral trade, FY 2025-26: $101.25 billion
• Above $100 billion for: the second consecutive year
• Non-oil share: close to two-thirds — roughly $67.5 billion
• Agreement: India–UAE CEPA, in force since May 2022
• Target A: $100 billion in non-oil, non-precious-metals trade by 2030
• Target B: $200 billion in total bilateral trade by 2032
• Implied CAGR to Target B: 12.0 per cent a year from FY26
• Indian sectors most exposed: gems and jewellery, engineering goods, textiles, agri-products, electronics
The composition matters more than the headline. When the relationship was overwhelmingly hydrocarbon, the trade number moved with the oil price and told you very little about either economy. With non-oil trade now close to two-thirds of the total, the figure has started to reflect manufacturing capacity, logistics and consumer demand — variables that policy can influence. That is why the two governments set a separate non-oil, non-precious-metals target of $100 billion by 2030 rather than relying on the headline alone.
Excluding precious metals from that second target is a technical decision with real analytical value. Gold and silver flows between India and the UAE are large, volatile and driven by arbitrage and duty structures rather than by underlying industrial demand. Strip them out and what remains — engineering goods, electronics, textiles, processed food, pharmaceuticals, construction materials — is a cleaner measure of whether the CEPA is doing what a trade agreement is supposed to do.
For Indian exporters the practical question is capacity rather than access. Tariff access under CEPA is already granted across the great majority of lines; the binding constraint on hitting a 12 per cent annual growth rate is whether Indian suppliers can meet UAE and re-export market specifications on volume, certification and delivery time. That is a factory-floor and logistics problem, not a negotiating one, and it is where the marginal rupee of policy support now earns the most.
Two risks belong in any honest forecast. The first is regional: a sustained disruption in Gulf shipping raises freight and insurance across the corridor regardless of tariff schedules. The second is base effect: growing at 12 per cent from $101 billion is arithmetically harder each year than growing at 12 per cent from $60 billion. Neither makes the target unreachable. Both mean the early years of the run carry more of the load than the late ones, which argues for front-loading the capacity investment now.