UAE signs off Modi visit with $5bn India investment pledge

• Indian PM meets UAE president
• Agreement on defence partnership
• Cooperation also on energy security

The UAE has agreed to invest $5 billion in India covering energy, defence, infrastructure, shipping and advanced technology.

Indian prime minister Narendra Modi met UAE President Mohamed bin Zayed Al Nahyan on Friday to discuss expanding cooperation under the two countries’ comprehensive strategic partnership and trade agreement.

India and the UAE agreed on a strategic defence partnership, petroleum reserves and liquefied petroleum gas (LPG) supplies, making energy security a key part of their relationship. Another agreement was signed to set up a ship repair cluster.

“Everyone is looking at the chance to build and grow despite the war,” said Prashant Gulati, president emeritus of entrepreneurs organisation TiE Dubai.

“The visit highlights that urgency and the commitment to grow and look beyond the limitations imposed by the war,” he added.

India, the world’s third-largest oil importer, wants to shield itself from supply volatility caused by the Iran conflict and wider instability across the region. The UAE is one of India’s largest suppliers of crude oil and liquefied natural gas and has emerged as a key partner in New Delhi’s long-term energy security plans.

The UAE left the Organization of the Petroleum Exporting Countries (Opec) on May 1 after almost 50 years. Going it alone should allow the UAE to ramp up oil production from 3.4 million barrels per day to 5 million by 2027.

India’s crude oil inventories have declined by around 15 percent, according to estimates from commodity data and analytics firm Kpler.

Traditional energy diversification away from the Strait of Hormuz has become a national-security imperative, according to analysts, and India is likely to increase its focus on identifying proven oil reserves and supporting offshore drilling.

“From an import perspective, Asia could see a transition towards more US, West African and South American crude,” said Vijay Valecha, chief investment officer at brokerage Century Financial.

UAE state energy giant Adnoc has agreed to explore expanding oil and gas storage projects with Indian Strategic Petroleum Reserves Limited.

The deal includes a possible rise in Adnoc’s oil storage capacity in India to as much as 30 million barrels, with potential facilities in Vishakhapatnam and Chandikol. The two sides are also exploring LNG and LPG stockpile projects in India, as well as potential crude storage in Fujairah linked to India’s strategic reserves.

Adnoc signed a separate agreement with Indian Oil Corporation to expand LPG supply and trading opportunities. The pact builds on a supply contract inked in 2023 and could lead to a longer-term deal, according to a statement on Friday.

“India’s scale and growth trajectory make it one of the defining energy markets of our time,” said Dr Sultan Al Jaber, Adnoc managing director and group CEO.

Further reading:

• Free from Opec, how much can the UAE raise oil output capacity?
• Abu Dhabi plans construction rush after quitting Opec
• Demand for oil severely outstrips supply, IEA warns

Abu Dhabi-based global technology group G42 and the Indian government formalised the framework and commercial terms for the deployment of Condor Galaxy India, an AI supercomputing cluster comprising Cerebras systems, during Modi’s visit.

The UAE is India’s third-largest trading partner and home to over 4.5 million Indians. At a January meeting between the UAE president and Modi in New Delhi, the UAE and India agreed to double bilateral trade to $200 billion by 2032.

“Indians and Indian companies have been very deeply involved in business in the UAE and these newer segments like defence, AI, energy will add to this list and will be greatly beneficial for both countries,” Gulati said.

The UAE and India signed a comprehensive economic partnership agreement (Cepa) in May 2022, following which bilateral trade crossed $100 billion in fiscal year 2024-2025, up from $72 billion in 2022.

In a statement on X, Modi said the outcomes of the visit would “further strengthen our friendship and contribute to growth and prosperity”.

“Recent agreements on defence cooperation, petroleum reserves and LPG supply during PM Modi’s UAE visit also show that both sides are moving from trade to strategic resilience,” Valecha said.

“The war has made one thing clear: countries now want trusted partners, not just cheaper suppliers,” he added.