Rise in India-UAE Trade, Time for SMEs to Explore New Markets

UAE's trade surplus with India rose to Dh2.2 billionThe areas in which India's exports to the UAE are
during the first quarter this year from a trade deficitwell diversified include gems and jewellery,
of Dh7.3 billion during the same period last year,engineering goods, tea, vegetables, fruit, spices, meat
according to a report released by the Ministry ofand its preparations, rice, textiles and apparel and
Foreign trade.chemicals, besides RMG cotton including accessories,
The report attributed this positive change to the bigman-made yarn, manufacture of metals, fabrics and
increase of 273 per cent in the value of UAE non-oilmade-ups, marine products, machinery and instrument
exports that went up from Dh2.2 billion during theand plastic products.
first quarter of 2009 to Dh8.4 billion this year. InThe report also said that mot only in trade with India
addition, the value of India-bound re-exported UAEbut in FDI also, UAE is considered the number one
commodities rose by 162 per cent, going up fromArab country, and the 10th globally in terms of the
Dh4.4 billion to Dh11.5 billion during the sameoverall value of Foreign Direct Investment inflows
comparison period.into India, preceded by Mauritius, Singapore, the USA,
The report also revealed that there is a 83 per centthe UK, Holland, Japan, Turkey, Germany, and France.
increase in the value of non-oil foreign trade betweenThe report predicted that the value of UAE
the two countries, going up from Dh20.5 billion toinvestments in India will reach Dh6.9 billion by the year
Dh37.5 billion. It is also expected that the value of2011. This was based on a survey of UAE
commercial exchange between both countries willinvestments abroad conducted by the foreign trade
increase from Dh108 billion in 2009 to Dh120 billion inministry that showed investments by UAE firms in
2010.India reached 5.7 billion dirhams.
In the report, it is also indicated that India is theIt also said that the value of UAE investments in
UAE's largest trade partner, while the UAE is theIndia, in light of the continuous development of
number one trade partner for Indian exports, andeconomic and commercial ties between India and the
second with regards to Indian imports, coming inUAE, will reach 6.9 billion dirhams by the year 2011.
second after China.The report also indicated that UAE investments in
The figures in the report suggests that it's time forIndia have witnessed a steady increase over the
the Indian SMEs, already exporting to UAE to rejoicepast 10 years, from $1.6 million in 2000 to $257 million
and celebrate the growing bilateral trade betweenin 2008, reaching $629 million in 2009.
India and UAE. Those SMEs which are still laggingUAE investments in India were concentrated in five
behind and have not explored other potentialmain economic sectors that took a 48.6 per cent
markets should take a cue from the recent figuresshare ($705 million) of the total value of these
and try to find buyers and importers for theirinvestments.
products in the UAE market.The energy sector received 19.1 per cent share of
Indian SMEs can make use of the online marketingUAE investments in India (worth $264 million),
tools, b2b portals as a medium to market theirfollowed by the services sector at 9.3 per cent ($143
products, give maximum exposure & visibility atmillion), programming and construction at 7.8 per cent
the global level and find prospective buyers and($115 million) and 6.8 per cent ($99.2 million)
importers from other countries as well. This will notrespectively, while tourism and hotels came in 5th
only cut advertising costs but also ensures maximumplace at 5.6 per cent ($84 million).
reach to the buyers.