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The Comprehensive Economic Partnership Agreement (CEPA) between India and the United Arab Emirates (UAE) is expected to be signed on Friday in the presence of Prime Minister Narendra Modi and UAE Crown Prince Sheikh Mohamed bin Zayed bin Sultan Al Nahyan in a virtual ceremony.

It is seen as a model for resuming the massive free agreement (FTA) with the Gulf Cooperation Council (GCC) at a critical juncture in world politics.

The CEPA will feature a digital commerce component, which officials say will be a first for both countries.

India’s third-largest commercial partner and second-largest export destination is the United Arab Emirates. In 2020-21, bilateral trade between India and the UAE was $43.3 billion. In 2020-21, exports were $16.7 billion, while imports, fueled by oil, swung the balance in the UAE’s favour at $26.7 billion. According to Commerce Minister Piyush Goyal, the India-UAE CEPA aims to increase bilateral trade to above $115 billion in five years. Goods trade is predicted to expand to $100 billion, while services trade is expected to increase by $15 billion.

According to Commerce Ministry sources, the early harvest agreement would most likely contain a chapter on digital trade, which will aim to improve future collaboration between the two countries in this field. The digital trade chapter is likely to include frameworks for paperless trading, digital payments, and online consumer protection, as well as address concerns like intellectual property rights in digital trade.

In areas like gems and jewellery, textiles, and leather goods, the accord is intended to open up the entire West Asian region to Indian industry. For its petrochemicals, metals, and dates, the UAE seeks to get more market access in India. “The fact that we were able to reach an agreement in record time – four months — demonstrates that where there is a will, there is a way.” India has the ability to reach out to other countries and negotiate free trade agreements. With this, the GCC free-trade agreement (FTA) negotiations might be relaunched. An official stated, “This FTA with the UAE will serve as a model for the GCC.”

According to one of the persons, the CEPA with the UAE will be the second major trade agreement after the CECPA between India and Mauritius, which was signed in February 2021. “The India-UAE agreement is strategically important for both countries. In five years, we estimate that bilateral trade will be worth $100 billion. “It’s a win-win situation for both of us,” he added.

Modi and Sheikh Mohamed bin Zayed are scheduled to lay out their vision for bilateral relations during the virtual summit, which takes place at a time when India is commemorating its 75th anniversary of independence and the UAE is commemorating its 50th. According to the foreign affairs ministry, the leaders will also address bilateral cooperation as well as regional and international concerns.

“The UAE is India’s second largest export destination, second only to the United States, and the rise of our exports to the UAE has been quite encouraging,” said Ajay Sahai, director general and CEO of the Federation of Indian Export Organisations (FIEO). Our exports to the UAE have already surpassed $25 billion in the first nine months of this fiscal year.”