UAE Considers Investing $50 Billion In India As Part Of Strengthening Bilateral Ties: Report

The United Arab Emirates (UAE) is fostering the idea of a $50 billion investment in the fastest-growing major economy of the world, India. The two countries currently share a vision of expanding their non-oil bilateral trade with each other.

Provisional pledges announcing the investment of billions of dollars from the UAE side might take place early next year, sources told Bloomberg.

The two countries have a goal of increasing their non-oil bilateral trade to $100 billion. The ongoing discussions could lead to the increase in UAE's stakes in India's infrastructure projects and state-owned assets.

Sovereign wealth funds such as the Abu Dhabi Investment Authority, Mubadala Investment Co., and ADQ could also flow into India as part of the deals.

With India gearing up for elections next year, Prime Minister Narendra Modi is likely to announce UAE's upcoming investments in the country as part of his bid for a third term.

UAE-India ties in recent years have strengthened under the leadership of Modi, whose 2015 visit to the former nation was the first trip made by an Indian prime minister to the gulf country in 34 years.

Modi has made five visits to the UAE in total in eight years, and the India-UAE relationship was formally elevated to a Comprehensive Strategic Partnership during Sheikh Mohamed bin Zayed Al Nahyan's visit to India in 2017.

Modi met the UAE president in July and expressed satisfaction over the ties between the two nations and also acknowledged "tremendous progress on all fronts."

Both the UAE and India have much to gain from each other, as Modi seeks large foreign investments to bolster the economy before the 2024 vote, while gulf countries seek to diversify their trade portfolio to include non-oil investments.

"The GCC countries have been investing significantly in economic reforms and diversification to prepare for a post-oil economy. They are also preparing themselves for a greener future which means reduced dependency on hydrocarbons. This is most importantly visible in the cases of Saudi Arabia and UAE," Md. Muddassir Quamar, author of "Education System in Saudi Arabia: Of Change and Reforms," previously told International Business Times.

Abu Dhabi conglomerate International Holding Co (IHC) said last month that it increased its stake in India's Adani Enterprises to more than 5% just days after selling its stakes in two other companies belonging to the Adani Group.

Entities overseen by Sheikh Tahnoon bin Zayed Al Nahyan -- the UAE president's brother and chairman of IHC -- have had early-stage talks on investing billions of dollars in India, a source told Bloomberg about the latest developments.