India and UAE are in talks to discuss the trade of non-oil commodities in Indian Rupees, as mentioned by the Emirati Foreign Trade Minister Dr. Thani Al Zeyoudi had informed. The UAE signed a wide-ranging free trade agreement (FTA) last year with India. China and India are said to be UAE’s biggest trade partners for Gulf Arab oil and gas producers whose most currencies are pegged to the US dollar. The India-UAE trade deal is said to be in the early stages which aims to increase the bilateral non-oil trade to US$ 100 billion within the next five years.
The majority of Gulf trade usually happens in US dollars whereas India and China are seeking to pay in local currencies for various reasons including lower transaction costs. The Foreign Trade Minister also mentioned that they were looking to accept the payments in the local currency but only with India so that it does not conflict with the overall interests of the nation.
The UAE Minister mentioned that UAE’s trade relations were increasingly looking to Asia. After the trade agreements with India and Indonesia, another trade agreement with Cambodia was expected to be concluded in the first quarter.
The world’s top oil exporter and the largest Arab economy would now be open to trade in other currencies apart from the US dollar, said the Finance Minister of Saudi Arabia.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.