India and UAE strengthen ties; agreements on energy and digital payments

India and the United Arab Emirates (UAE) further strengthened their strategic partnership this week, signing eight agreements in Abu Dhabi to enhance cooperation. Indian Prime Minister Narendra Modi met with UAE President Mohamed bin Zayed Al Nahyan on Tuesday, where the two leaders oversaw the exchange of the new accords.

The signing of a bilateral investment treaty was a key outcome, which analysts say will spur more investments between the countries. An MOU on electrical interconnection and electricity trade also opens up collaboration in the energy sphere and energy security.

Notable was the linking of the instant digital payment platforms of India and the UAE - India's Unified Payments Interface (UPI) and the UAE's AANI system. This will enable seamless cross-border transactions. The RuPay credit card system of India will also now be linked with the new UAE digital payment system Jaywan.

According to officials, connecting the digital payment mechanisms symbolises the growing fintech cooperation between the nations. Modi and the UAE President witnessed a transaction using the Jaywan card at the meeting.

"We extend a warm welcome to the Republic of India, the guest of honour at this year’s World Governments Summit, and to His Excellency Narendra Modi, the Prime Minister of India. The strong ties between our nations serve as a model for international cooperation. The… pic.twitter.com/s03iJZwWam

— Press Trust of India (@PTI_News) February 13, 2024

The leaders described the soon-to-be-inaugurated BAPS Hindu temple in Abu Dhabi as an "embodiment" of India-UAE friendship and religious tolerance. Modi praised the UAE's assistance in constructing the temple.

Modi departs for Qatar next, as part of his two-nation tour. This second leg will further India's outreach in the strategically important Gulf region. Qatar hosts some 800,000 Indian expatriates. The Prime Minister last visited Qatar in 2016.

Analysts say the successive high-level visits showcase India's growing partnership with the Gulf states, which supply most of its energy needs. Trade with the UAE received a boost especially after the countries signed a free trade pact in 2022.