India-UAE Joint Defence Cooperation Committee (JDCC)

The 13th Joint Defence Cooperation Committee (JDCC) meeting between India and the United Arab Emirates (UAE) took place in New Delhi. During this meeting, both nations reaffirmed their strong commitment to deepening defence ties and enhancing strategic cooperation. The discussions were centered around expanding military collaboration, improving joint capabilities, and fostering long-term partnerships to address regional security challenges effectively.

Key Outcomes of the JDCC Meeting

One of the significant outcomes of the meeting was the signing of a Memorandum of Understanding (MoU) between the Indian Coast Guard and the UAE National Guard.

This MoU aims to boost maritime security cooperation in the Indian Ocean Region (IOR) by focusing on critical areas such as Search and Rescue (SAR) operations, anti-piracy measures, pollution response, and real-time sharing of information.

This partnership is expected to strengthen the ability of both countries to respond quickly and effectively to maritime threats and emergencies.

In addition to maritime security, the two countries agreed to enhance their defence manufacturing collaboration. The existing partnership under the ICOMM-CARACAL small arms program was highlighted as a successful model, and both sides expressed interest in expanding joint ventures. There is a particular focus on the co-development of advanced technologies such as artificial intelligence (AI) and shipbuilding capabilities, including the refitting and maintenance of shared defence platforms. This would not only improve operational readiness but also foster technological innovation and self-reliance in defence production.

The meeting also saw inter-service discussions involving the Indian Army, Navy, and Air Force alongside their UAE counterparts. These talks were aimed at boosting joint military exercises, expanding training programs, facilitating the exchange of Subject Matter Experts (SMEs), and improving coordination among the three services. This tri-service interoperability is considered crucial for enhancing the overall efficiency and effectiveness of combined defence operations in the region.

Significance of India-UAE Relations

The bilateral relationship between India and the UAE holds substantial economic and strategic significance. The UAE is India’s third-largest trading partner and second-largest export destination, while India ranks as the UAE’s second-largest trading partner. Their trade encompasses a broad range of sectors including petroleum, gems and jewelry, agriculture, textiles, chemicals, and engineering goods. This diverse trade relationship underpins the economic interdependence of the two countries.

Strategically, the UAE plays a vital role as a major oil supplier to India and as a key contributor to India’s Strategic Petroleum Reserves (SPR). The SPR is critical for India’s energy security, providing a buffer against global oil market volatility and ensuring uninterrupted energy supply. Furthermore, the UAE’s contribution is essential for maintaining stability in the Gulf region, which directly impacts India’s energy interests. To facilitate smoother trade and financial transactions, India and the UAE have signed a Memorandum of Understanding to establish a Local Currency Settlement System and integrated payment mechanisms, thereby reducing dependence on foreign currencies and enhancing financial cooperation.

At the multilateral level, the UAE is a strategic partner for India in various international platforms such as I2U2 (India-Israel-UAE-USA), IMEC (India-Middle East-Europe Corridor), and the Abraham Accords. Participation in these platforms strengthens India’s connectivity, broadens its economic influence, and enhances its energy security by fostering greater collaboration with Gulf countries and other partners.

Culturally and socially, the UAE hosts a large Indian diaspora of approximately 3.5 million people, making it one of the most significant overseas Indian communities. This demographic presence has facilitated strong people-to-people ties and contributed significantly to the economic bonds between the two nations. The construction of a Hindu temple in Abu Dhabi symbolizes the deep-rooted cultural connection and mutual respect shared by India and the UAE, reflecting the broader spirit of partnership beyond just economic and strategic interests.

Why is the UAE Important for India?

Strategic Political Partnership

• India-UAE relations have been elevated to a comprehensive strategic partnership.

• Establishment of a strategic security dialogue reflects growing political and strategic alignment.

Bilateral Trade

• UAE is India’s third-largest trading partner.

• The Comprehensive Economic Partnership Agreement (CEPA) signed in 2022 boosted trade from USD 72.9 billion (2021-22) to USD 84.5 billion (2022-23), a 16% increase.

Foreign Direct Investment (FDI)

• UAE is India’s fourth-largest investor.

• FDI from UAE to India surged over three-fold to USD 3.35 billion in FY23 from USD 1.03 billion in 2021-22.

Energy Security

• UAE is a key supplier of oil to India.

• Plays a vital role in India’s Strategic Petroleum Reserve (SPR) ensuring energy security.

Financial Collaboration

• Launch of India’s RuPay card and Unified Payments Interface (UPI) in the UAE.

• Agreement on a Local Currency Settlement (LCS) system for cross-border trade in Indian Rupee (INR) and UAE Dirham (AED).

Space Exploration

• MoU signed between ISRO and UAE Space Agency (UAESA) for cooperation in peaceful outer space exploration.

Defence and Security Cooperation

• Strengthened collaboration on counter-terrorism, intelligence sharing, and joint exercises (e.g., Exercise Desert Cyclone).

• UAE shows growing interest in Indian defence products like BrahMos missiles, Akash air defence system, and Tejas fighter jet.

Multilateral Engagements

• UAE’s participation in I2U2 (India-Israel-UAE-US) and the India-Middle East-Europe Economic Corridor (IMEC) highlights its strategic and economic importance.

Regional Stability

• UAE’s role in the Abraham Accords and normalization with Israel fosters regional peace.

• Stability in the Middle East is crucial due to India’s heavy dependence on Gulf energy imports.

Cultural and Diaspora Links

• Large Indian diaspora (~3.5 million people) forms an important bridge between the countries.

• Cultural initiatives like the first Hindu temple in Abu Dhabi demonstrate shared values of tolerance.

Cooperation During COVID-19

• Mutual assistance through medical supplies, equipment, and vaccines during the pandemic strengthened ties.

Challenges in India-UAE Relations

Limited Trade Diversification

• Trade remains concentrated in sectors like gems and jewellery, petroleum, and smartphones.

• Insufficient expansion into new categories limits broader economic benefits.

Rising Import Costs

• Imports from UAE increased 19% year-on-year to USD 53.2 billion in FY23.

• High dependency on certain imports pressures India’s trade surplus.

Non-Tariff Barriers

• Export hurdles such as mandatory Halal certification affect processed food exports.

• These limit India’s market access and competitiveness in the UAE.

Human Rights Concerns

• Issues with the Kafala system, which controls migrant workers’ employment and status, raise rights concerns.

Diplomatic Balancing Act

• India needs to carefully navigate regional conflicts such as the Israel-Hamas war and tensions between Iran and Arab nations.

UAE’s Financial Support to Pakistan

• UAE’s financial aid to Pakistan causes concern over potential misuse for anti-India activities.

• This complicates diplomatic relations.

Way Forward

Promote Trade Diversification

• Focus on emerging sectors like technology, renewable energy, and pharmaceuticals.

• Achieve a balanced trade relationship and broader economic benefits.

Strengthen Economic Ties

• Explore joint ventures and partnerships to enhance collaboration.

• Mitigate the impact of rising import costs.

Enhance Dialogue on Human Rights

• Initiate discussions to address concerns about the Kafala system.

• Advocate reforms improving rights and working conditions of migrant workers, aligning with international labour standards.

Focus on Areas of Common Interest

• Engage in proactive diplomacy to align on shared goals.

• Ensure geopolitical tensions do not harm bilateral relations.