India-UAE framework pact for IMEC gets Union cabinet nod

The Union Cabinet on Wednesday gave its approval to the inter-governmental framework agreement (IGFA) signed between India and the United Arab Emirates (UAE) to bolster bilateral ties under the India-Middle East Europe Economic Corridor (IMEC).

The India-UAE IGFA was signed on Wednesday during a high-level visit between the two nations. It focuses on cooperation for the empowerment and operation of the IMEC, said an official statement.

The IMEC is a significant trade route connecting India with the Middle East and the Europe. The economic corridor consists of two distinct sections -- the East corridor that will connect India to the Middle East, and the Northern corridor that will connect Middle East to Europe.

This trade route holds immense potential for facilitating the movement of goods and services across the regions.

The agreement aims to harness this potential trade route by fostering collaboration between the two nations in the sectors of ports, maritime, and logistics.

The agreement contains a detailed framework for cooperation between the two countries, encompassing a wide array of areas aimed at exploring the untapped potential for joint investment and collaboration in the development of the IMEC. By leveraging each other’s strengths in the ports, maritime, and logistics sectors, both countries can unlock new avenues for growth and create a conducive environment for trade and investment.

Under the IMEC, Saudi Arabia has already committed $20 billion investment. In November 2023, Saudi Arabia’s council of ministers had approved a memorandum of understanding (MoU) regarding the principles of the IMEC.

Last November, Union finance minister Nirmala Sitharaman had announced “promising prospects” of the India-Middle East-Europe Corridor.

The IMEC initiative aims to revolutionise transportation efficiency, cut logistics expenses, bolster economic cooperation, drive jobs creation, and mitigate greenhouse gas emissions for all involved stakeholders.

The IMEC was inked during India’s G-20 presidency at the 18th G-20 Summit in New Delhi in September.