India is expected to become the UAE’s top export destination by 2030 even as the total value of trade between the two countries has declined steadily over the past two years.
Currently Japan tops the list followed by India, South Korea, Singapore and China, according to HSBC Trade Forecast report.
Other fast-growing export markets for the UAE between 2017 and 2030 include Malaysia, Vietnam and Turkey, according to the survey.
While India is the UAE’s top trading partner, total trade between the UAE and India has been falling since the 2011-12 financial year.
The figure stood at US$59.6 billion in the financial year ending March, a drop of 21 per cent over the previous year.
The UAE imported goods worth $30.49bn from India during the financial year ending March, representing a decline of 16 per cent year-on-year.
Exports to India totalled $25.11bn during the financial year, down by more than a quarter.
HSBC analysts say the decline is a temporary setback, in line with the sluggishness of world trade growth in 2012-13 and the slowdown in India’s economy. The underlying fundamentals, such as demographic trends, will help it take advantage of the recovery of global trade, the bank said.
By 2030, petroleum products will still account for the largest share of the UAE’s trade comprising 40 per cent of total export growth with India and China as the top buyers.
Infrastructure and construction, tourism, retail and government investments in technology will continue to drive UAE growth, said Tim Evans, the regional head of global trade and receivables finance.
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