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Industry has raised concern over United Arab Emirates (UAE) trade officials asking to market pharma products exported from India at the same rate at which it is marketed in India. This according to officials associated with the India-UAE Comprehensive Economic Partnership Agreement (CEPA) is not commercially feasible and will affect the provisions of bilateral trade negatively.
The export to UAE from India was to the tune of 321.64 million dollars in FY 2021 and increased to 333.77 million dollars in FY 2022.
The India-UAE CEPA which was signed between the two nations on 18 February 2022, came into force from May 01, 2022.
As per the bilateral trade agreement, India will benefit from preferential market access provided by the UAE on over 97% of its tariff lines which account for 99% of Indian exports to the UAE in value terms particularly from labour-intensive sectors which also includes pharmaceuticals and medical devices.
Pharmaceutical businesses can now take advantage of many new benefits as a result of the agreement including greater access for UAE exports entering the Indian market through the reduction or removal of tariffs on more than 80 per cent of products.
CEPA is expected to increase the total value of bilateral trade in goods to over US$ 100 billion and trade in services to over US$ 15 billion within five years.
The India-UAE CEPA assumes significance, as it was the first free trade agreement (FTA) that New Delhi had signed with any economy in a decade, shedding its inhibitions about the efficacy of trade deals. After the agreement with the UAE, India has also hammered out an interim trade deal with Australia and is in talks for FTAs with New Zealand, the UK, the EU, Canada and members of the Gulf Cooperation Council.
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