India-UAE Virtual Summit

🔆 India-UAE Virtual Summit

✅ In a historic move, India and UAE signed the futuristic Comprehensive Economic Partnership (CEPA) during a virtual summit.

♻️ What is CEPA?

✅ The CEPA is a bilateral trade agreement that includes trade in goods and services, investments, competitions and Intellectual Property Rights.

♻️ About Free Trade Agreement:

✅ A free trade agreement is a pact between two or more countries to reduce trade barriers facilitating imports and exports.

✅ The goods and services can be brought within the purview of free trade policy.

✅ It involves trade across international borders with little or no government tariffs, quotas, subsidies or any inhibition in the exchange of goods and services. 

✅ It is implemented by a formal and mutual agreement between the participating nations. 

✅ A government need not take specific action to promote free trade and is free from stringent regulations and interference which is often referred to as laissez-faire trade or trade liberalisation. However, in the US and European Union, free trade agreements do not come without regulations and oversight.

✅ In the modern-day practice of international trade, few trade agreements result in completely free trade. 

✅ The US has a number of free trade agreements such as NAFTA and the Central American Free Trade Agreement. 

♻️ The India- UAE trade agreement:

✅ The free trade agreement aims to boost the trade relations between the two countries to US$ 100 billion in the next five years. 

✅ The joint vision statement emphasised on enhanced maritime cooperation, collaborative efforts to fight terrorism and measures to boost trade and investments. 

✅ The signing of CEPA will result in several benefits like promoting businesses, enhancing market access and reduced tariffs. 

✅ Two MoUs have been signed including a MoU between APEDA and DP World and Al Dahra has been signed to set up a food security corridor and MoU between India’s Gift city and Abu Dhabi Global Market on cooperation in financial projects and services. This will be a welcoming move to enhance resilience and reliability of food supply chains.

✅ The two countries also agreed to work together on logistics and services, pharmaceuticals, medical devices, agriculture, agri-tech and steel and aluminium. 

✅ According to CEPA, an extension of zero duty will be given to several sectors comprising 9% of India’s exports within five to ten years. 

✅ The trade agreement will also facilitate the automatic registration and marketing authorisation of Indian generic medicines in 90 days. UAE plans to become a global regional distribution hub for pharmaceuticals by 2030 which will be of immense benefit to India.