Trilateral critical mineral deals, wider air pact key to India-UAE ties ahead, says UAE Minister
India and the UAE are exploring joint investment models to secure critical mineral supply chains in third countries, building on an existing framework for cooperation in mineral exploration and processing.
The two sides are discussing an expanded air services arrangement, including higher bilateral seat entitlements, to support growing trade and tourism traffic.
Officials indicated that easing seat capacity constraints could lower airfares on India-UAE routes and expand direct connectivity to more Indian cities.
Both countries reaffirmed an upgraded bilateral trade target of $200 billion, building on trade already crossing $100 billion for two consecutive years under the existing economic partnership.
India-UAE Comprehensive Economic Partnership Agreement (CEPA)
CEPA is a broad-based trade agreement that goes beyond a conventional Free Trade Agreement (FTA) by covering trade in goods, services, investment, and cooperation in areas like digital trade and government procurement. India signed the CEPA with the UAE on 18 February 2022, and it came into force on 1 May 2022 — India's first such comprehensive deal with a Gulf nation.
Key Details
- Original target: bilateral trade of $100 billion (non-oil trade) within five years of CEPA
- The target was achieved ahead of schedule, with trade crossing $100 billion in consecutive years, prompting a revised goal of $200 billion by 2032
- CEPA covers renewable energy, civil nuclear cooperation, critical minerals, fintech, aviation, logistics, food security, and space sectors
- India has separately signed CEPAs with Australia (2022) and is negotiating one with the UK; UAE CEPA was among the first under India's post-2021 trade agreement push
The $200 billion target discussed by the UAE Minister is the revised CEPA-linked trade goal, and the mineral/air services cooperation being explored are meant to widen the CEPA's non-oil trade base beyond hydrocarbons and gems/jewellery.
Critical Minerals Cooperation and Third-Country Investment
Critical minerals — such as lithium, cobalt, nickel, and rare earth elements — are essential for clean energy technologies, electronics, and defence manufacturing, and India depends heavily on imports for most of them. India has pursued government-to-government and joint-venture mechanisms to secure these supply chains, including through Khanij Bidesh India Ltd (KABIL), a state-owned joint venture (NALCO, HCL, MECL) set up in 2019 specifically to acquire overseas mineral assets.
Key Details
- India joined the Mineral Security Partnership (MSP), a US-led plurilateral initiative launched in 2022, to diversify critical mineral supply chains away from single-country dependence
- KABIL has signed cooperation instruments with resource-rich countries and entities, including an arrangement with a UAE-based entity for global collaboration in critical mineral exploration in third countries
- India notified a National Critical Mineral Mission (2024) identifying 30 critical minerals for domestic and overseas sourcing
- Trilateral models (e.g., India-France-UAE) are being discussed for joint financing of overseas mineral assets, pooling capital and technology
The "trilateral critical mineral deals" referenced are an extension of this strategy — using UAE capital and India's processing/demand base to jointly invest in mineral-rich third countries, reducing China's dominance in critical mineral processing.
Bilateral Air Services Agreements and Seat Entitlements
Air Services Agreements (ASAs) are bilateral treaties between two countries that determine which airlines can fly between them, on which routes, and how many seats (capacity) can be offered — a framework governed under the Chicago Convention (1944) principles of national sovereignty over airspace. India regulates its side through the Ministry of Civil Aviation and the Directorate General of Civil Aviation (DGCA).
Key Details
- India-UAE seat entitlements have largely remained capped since around 2014, split mainly between Dubai and Abu Dhabi routes
- Constrained bilateral capacity has been cited as a factor keeping airfares elevated on India-Gulf routes despite strong demand from the large Indian expatriate population in the UAE (over 3.5 million, India's largest overseas diaspora concentration)
- Expanding entitlements requires renegotiation of the bilateral ASA between the DGCA and UAE's General Civil Aviation Authority (GCAA)
- Aviation liberalisation is a recurring theme in India's Gulf diplomacy, alongside trade and labour mobility issues
The UAE Minister's call for a "wider air pact" reflects ongoing but unresolved negotiations to raise capped seat quotas, which both sides link to lowering fares and boosting the tourism and trade volumes needed to hit the $200 billion target.
- India-UAE CEPA signed: 18 February 2022; entered into force: 1 May 2022
- Original trade target of $100 billion achieved ahead of the five-year schedule; revised target: $200 billion by 2032
- Bilateral trade crossed $100 billion for the second consecutive year in FY 2025-26, with non-oil trade forming roughly two-thirds of the total
- Dubai and Abu Dhabi weekly seat entitlements have stayed largely unchanged since 2014-15 despite rising demand
- KABIL (Khanij Bidesh India Ltd), formed in 2019, is India's nodal vehicle for overseas critical mineral acquisition