Strengthening India-UAE Investment Relations | 09 Oct 2024

Source: PIB

India has reduced the local remedies exhaustion period for United Arab Emirates (UAE) investors from five years to three years under the India-UAE Bilateral Investment Treaty (BIT).

  • The BIT came into force on 31st August 2024, ensuring continuity of investment protection after the expiration of the earlier Bilateral Investment Promotion and Protection Agreement (BIPPA).
    • The BIT assures minimum treatment standards (fairly and equitably) and independent arbitration for dispute resolution.
    • The local remedies exhaustion period is the time frame an investor must attempt to resolve a dispute through the host country’s legal system before seeking international arbitration.
  • In another development, the Abu Dhabi Investment Authority (ADIA) has opened an office in GIFT City to enhance its investment activities in India.
    • UAE continues to be the largest Arab investor in India, with investments amounting to around USD 3 billion in FY 2023-24.
    • The UAE was the sixth-largest Foreign Direct Investment (FDI) source for FY 2023-24 and the seventh-largest overall since 2000.
    • Over 70% of all Gulf Cooperation Council (GCC) investments in India come from the UAE.
  • Additionally, India and the UAE are advancing plans for a USD 2 billion food corridor to enhance UAE food security and support Indian farmers, with the Comprehensive Economic Partnership Agreement (CEPA) and BIT ensuring duty-free access and a stable investment climate for UAE businesses.

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