India and the United Arab Emirates (UAE) have agreed to formally review their Comprehensive Economic Partnership Agreement (CEPA) as both nations work to address emerging trade concerns, refine existing provisions, and unlock new opportunities for bilateral cooperation. The decision reflects the deepening economic relationship between the two partners, who signed CEPA in 2022 with the aim of strengthening trade, investment, and strategic collaboration across multiple sectors.
Since the implementation of CEPA, bilateral trade has expanded significantly, with the UAE emerging as one of India’s largest trading partners and a key gateway for Indian exports to the Middle East, Africa, and Europe. However, evolving market dynamics, new regulatory requirements, and sector-specific challenges—particularly in the gold and jewelry trade—have prompted both countries to initiate a comprehensive review of the agreement.
One of the most important issues on the table is the gold-import quota, which has long been a sensitive topic for India’s gems and jewelry industry. Under CEPA, India is allowed to import a certain quantity of gold from the UAE at reduced customs duties. While the provision has benefited jewelry manufacturers, Indian industry groups have argued that the current quota is insufficient to meet growing domestic demand. This has created pricing disparities and limited the competitiveness of Indian exporters, prompting calls for a substantial increase in the quota.
The UAE, a major global gold trading hub, has expressed willingness to revisit the gold-quota mechanism as part of the broader CEPA assessment. Officials from both sides have indicated that negotiations are progressing positively, with a shared goal of ensuring that trade benefits are balanced, mutually advantageous, and aligned with market realities. Increasing the quota or revising tariff concessions could significantly strengthen India’s jewelry sector—one of the country’s largest export industries.
Beyond gold, the CEPA review is expected to address a range of other issues, including market access, regulatory harmonization, customs procedures, and the expansion of services trade. India is seeking improved access for its IT, fintech, healthcare, education, and professional-services sectors, while the UAE is looking to attract greater Indian investment in logistics, advanced manufacturing, renewable energy, and digital technologies.
The review also comes at a time when both nations are seeking to boost supply-chain resilience and diversify trade routes. The UAE’s strategic initiatives—such as its logistics modernization plans and growing free-zone ecosystem—align with India’s efforts to expand exports and deepen economic linkages within the Gulf region. The two countries are additionally cooperating on fintech connectivity, renewable-energy partnerships, and food-security initiatives, all of which are expected to be strengthened under an updated CEPA framework.
Diplomatically, the commitment to revisit CEPA underscores the maturity and flexibility of India-UAE relations. Rather than viewing the agreement as static, both sides see it as a living framework designed to evolve with changing economic conditions. The ongoing discussions aim not only to resolve current challenges but also to enhance long-term strategic cooperation between two of the fastest-growing economies.
As negotiations move forward, industry stakeholders in both countries are optimistic that the review will deliver enhancements to CEPA, boost bilateral trade, and reinforce the India-UAE partnership as a central pillar of regional and global economic growth.
