UAE to invest in India’s mega food parks to secure supplies

The two countries plan diversified and resilient supply chain in the post-pandemic era

Dubai, United Arab Emirates - October 30th, 2017: Dr Ahmed Al Banna (UAE ambassador to India) speaks on a panel at the India-UAE Partnership Summit 2017. Monday, October 30th, 2017 at The Armani Hotel, Dubai. Chris Whiteoak / The National
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The UAE has planned major investments in India’s mega food parks and logistic infrastructure as both countries strive for a dependable food supply.

UAE companies are expected to invest $7 billion in India in the next three years as part of the UAE-India Food Corridor project.

There is renewed interest in the project as envoys and top businessmen from the two countries spoke at an online Food Security Summit on Tuesday to highlight future collaboration.

The Covid-19 pandemic has severely tested all nations and has brought focus on the vulnerabilities of the existing supply chain

Ahmed Al Banna, ambassador of the UAE to India, said unprecedented times made countries realise the power of strategic global alliances.

“It is a very opportune time for the UAE and India to escalate food security co-operation,” he said.

“Now is a critical time to work together to navigate better economic recovery and set priorities for post-Covid recovery and this is one platform that will lead us to that goal.”

The UAE wanted to tie up with India to develop a diversified and resilient supply chain in the post-pandemic era, he said.

“The Covid-19 pandemic has severely tested all nations and has brought focus on the vulnerabilities of the existing supply chain,” Mr Al Banna said.

The UAE, like other GCC countries, imports nearly 85 per cent of its food products.

Both countries will gain from the co-operation with the corridor expected to create 200,000 jobs across India.

Pavan Kapoor, India's ambassador to the UAE, said India wants to work closely with the Emirates in its quest for food security. Courtesy: Indian embassy, UAE

India’s market share in UAE food imports is only 11 per cent.

But the country loses a staggering 67 million tonnes, or 30 per cent, of agricultural produce because of poor storage and transport.

UAE investments will help establish warehouse centres, cold-storage chains and food processing facilities in India to minimise turnaround time and reduce waste.

The Mega Food Park is a scheme of the Ministry of Food Processing in India to establish collection and processing centres to collect produce from farms and supply them to the markets.

Companies in India also see the Emirates as a natural route through which to reach other markets in the Mena region.

Vendors wait for customers at a wholesale fruit and vegetable market in Ghaziabad on December 8, 2020. - Indian farmers who have been blockading New Delhi on December 8 launched a one-day, nationwide general strike to push their demands for the government to repeal reform laws opening up trade in agricultural produce. (Photo by Prakash SINGH / AFP)

Indian ambassador Pavan Kapoor said UAE importers continued to get supplies through cargo and charter planes even during the lockdown in India in the early months of the pandemic.

“India wants to work closely with the UAE in its quest for food security,” he said.

“We want to assure our Emirati friends not only will we continue to be a reliable partner, but in fact want to work much harder to realise the full potential in this area.”

Sharafuddin Sharaf, vice chairman of the Sharaf Group, said the company planned further investments in logistics infrastructure in India.

“As investors, we have started to put into place our business plan to actually build multimodal logistics facilities including rail depots and cold-chain facilities to add value to Indian perishable and agri products,” he said.

Juma Al Kait, assistant undersecretary for international trade affairs at the UAE Ministry of Economy, said eight new food parks in the Indian states of Gujarat, Madhya Pradesh and Maharashtra were being evaluated.

Currently, there are 21 mega food parks in the country.

The food corridor project had “gained more relevance due to the disruption of global supply chains because of Covid-19”, Mr Al Kait said.

Investment from the UAE would cover dedicated logistics infrastructure to connect farms to ports in India, he said.

Dr Aman Puri, Indian consul general in Dubai, anticipated growth because food security was a priority for both countries.

“Covid-19 has highlighted the benefit of deeper integration of economies,” he said.

“It is our assessment that there is huge untapped potential to take this partnership to the next level."