India-UAE Relations: From Transactional to Strategic
Photo Credit: AP
By Aditi Bhaduri

India-UAE Relations: From Transactional to Strategic

Feb. 26, 2018  |     |  0 comments

Indian Prime Minister Narendra Modi recently visited the United Arab Emirates (UAE) as part of his Middle East trip. His stop in Abu Dhabi was possibly the most important, if not significant part of the trip, which began on February 9, 2018 and also included Jordan, Palestine and Oman.


Modi made his very first trip to the region with a standalone visit to the UAE in August 2015. That visit had the spectacular optics of six princes receiving him, and was the first by an Indian prime minister in 34 years, and imparted greater vigor and dynamism to the relationship. Modi’s visit was followed by two visits of the UAE crown prince and Dy. Commander of the UAE’s armed forces Sheikh Mohammed bin Zayed Al Nahyan to India. The first was in 2016, a bilateral one, and the second in 2017, as Chief Guest for India’s Republic Day celebrations, an honour reserved for only those very special. During this visit, bilateral relations were elevated to “strategic” ones.


On his current visit, Modi also attended the World Government Forum as Guest of Honour — again an occasion for those deemed important by the Gulf sheikhdom. At the airport, breaking with protocol, Modi was received by the Crown prince himself. On the eve of the visit, the UAE Ambassador to India, Dr. Ahmed Al-Banna, in an interview to Arab News said that India and the government of Prime Minister Narendra Modi are among the best friends of the UAE. These frequent visits are a testimony to the increasing cooperation and importance that Delhi and Abu Dhabi are attaching to bilateral ties and the significance that each occupies in the other’s strategic radar.


The Gulf region and India share cultural and trade ties that go back centuries, which continued right through the British colonial presence in the Indian subcontinent and Gulf region. More recently, the imperatives of energy security and the labor market have cemented the ties between the two sides. At the core of this engagement are people-to-people ties. The UAE is home to the largest Indian expatriate community, standing strong at some 3.3 million, and is the source of one of India’s largest overseas remittances amounting to USD 13.2 billion. The Gulf economies were built on the backs of Indian labor. With their low profile, industriousness, and non-interference in the political life of the host nations, Indian labor came to represent all that was commendable and trustworthy in an expatriate community. When crisis gripped the region, like during the gulf wars, it was this community that became the natural choice for filling in the space left behind by a receding Palestinian or Yemeni labor force.


The UAE also figures prominently in India energy security. Though the volatility of the region has forced India to diversify its energy procurement, the UAE along with Saudi Arabia are the largest suppliers of India’s crude requirements. The UAE became the first country to contribute to India’s strategic petroleum reserves under an agreement signed in 2016 during the Crown Prince’s visit to Delhi, which is mutually beneficial. For India it is a major gain, given that India’s energy demand is expected to quadruple in the next 15 to 17 years, while the UAE stands to gain from the geographical proximity in case of any emergency situation arising in the region. During this current trip India and the UAE signed a historical agreement for a consortium of Indian oil companies which were awarded a 10 percent interest in Abu Dhabi’s offshore Lower Zakum concession. This was the first-time Indian oil and gas companies have been given a stake in Abu Dhabi’s hydrocarbon resources.


Trade is another major area of mutual interest, amounting to USD 53 billion. India is the UAE’s largest and the UAE is India’s third largest trading partner. Both sides have also been major investment destinations for each other with the USD 75 billion National Infrastructure Investment Fund set up during the UAE Crown Prince’s 2017 visit to India.


Their ever-growing cooperation is now entering into newer areas like cooperation in space and joint defense production. Yet, in spite of the above, two other major factors have also significantly helped to transform bilateral relations from transactional to strategic: terrorism and the shifting geo-political alignments in the region.

When Indian PM Narendra Modi paid a visit to the UAE in 2015, both countries decided that their two national security advisers would meet every six months and would host regular counter-terrorism meets.

The first defense cooperation between the two sides was signed in 2003, soon after the devastating attacks of September 11, 2001 in New York. The 26/11 attacks in Mumbai in 2008 alerted the UAE authorities to the dangers of a seaborne attack, as terrorists had entered Mumbai by boat and targeted multiple locations, killing more than 150. With its long coastline, the UAE was particularly vulnerable. Hitherto unconcerned, the Gulf countries, including the UAE, began to take a more regional perspective on terrorism. Both countries then entered into agreements on logistics and intelligence-sharing. This terror threat has increased manifold now with the rise of the Islamic State which seeks the dismantling of Arab regimes in the region.


Geo-political dynamics have only furthered this partnership. A receding American footprint in the region, a resurgent Iran, the increasingly vicious divide between the Shia and Sunni sects, and an increasing Russian role in the region have ensured that the UAE, along with other Gulf Cooperation Council states, is looking increasingly eastwards. At the same time, the UAE’s relations with Pakistan, a major Muslim military power in the region, has begun to fray, especially over Pakistan’s refusal to participate in the Yemen war on behalf of the Saudi-led military alliance which includes the UAE.


Pakistan, in lieu of hefty financial aid and investment, shares close ties with the Gulf countries, rendering military and policing services to them. Over the years, Gulf countries have increasingly become sceptical of Pakistan’s ability to double down on terror groups operating from its territory. For instance, it was unable to prevent an attack on the UAE’s royal family in December 2016. In January 2017, five UAE diplomats were killed in a terror attack in Kandahar, Afghanistan, by the Taliban who are known to be sheltered in Pakistan. At the same time, Pakistan has been warming up to Iran adding to the perception that it was an unreliable ally.


All these factors have only underscored the fact — to India’s advantage — that the security concerns of South Asia dovetail with those of the Gulf region. These concerns have been reflected in the joint statements that have been issued during the successive bilateral visits that have taken place between India and the UAE. When Indian PM Narendra Modi paid a visit to the UAE later in 2015, both countries decided that their two national security advisers would meet every six months and would host regular counter-terrorism meets. This is an agreement India has not entered into with any other country. In February 2016, during the Crown Prince’s Delhi visit, a little over a month after the January 2 terror attack on the Pathankot Indian Air Force station — for which India holds Pakistan responsible — both sides issued a joint statement which strongly condemned extremism and terrorism, including state-sponsored terror using non-state actors. The symbolism was not lost.


This year’s joint statement explicitly stated that “both sides resolved to deepen cooperation on combating extremism and further strengthen their efforts in countering terrorism” and reiterated “their condemnation for efforts, including by states, to use religion to justify, support and sponsor terrorism against other countries, or to use terrorism as instrument of state policy … (and) … deplored efforts by countries to give religious and sectarian colour to political issues and pointed out the responsibility of all states to control the activities of the so-called ‘non-state actors’, and to cut all support to terrorists operating and perpetrating terrorism from their territories against other states … to eliminate safe havens and sanctuaries that provide shelter to terrorists and their activities.”


At a time when India is battling renewed cross-birder violence emanating from Pakistan in its sensitive border state of Jammu and Kashmir, the statement is significant. The UAE also agreed to work with India to adopt the Comprehensive Convention against Terrorism that India had piloted in the UN. At the same time the two countries are deepening their defence ties. For example, they are exploring joint production in defence with an eye to third country markets, while deepening maritime security in the Gulf and the Indian Ocean. The first bilateral Naval Exercise is slated to be held in 2018.


Given all of this, ties between India and the UAE will only continue to deepen in the foreseeable future to the benefit of both sides, underpinned by the prospect of crafting a regional security architecture.


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