Dr Aman Puri, Consul General of India, Dubai, believes that this a critical inflexion point for India-UAE trade and investment relations in the F&B sector. To make the best of this opportunity, Indian exporters need to work on their packaging and promotion, and invest time and energy in understanding the unique market dynamics of UAE. Moreover, the ongoing Dubai Expo needs to be leveraged effectively by Indian F&B companies and startups to boost trade and attract investments from UAE.
Recently the Prime Minister of India Shri Narendra Modi has given a clarion call to increase India’s exports to US$ 400 billion. This emphasis comes at a very appropriate time, as India is witnessing an impressive surge in its exports in comparison to other major economies. Merchandise exports for April-September 2021 were recorded at US$ 197.9 billion, growing by 57.53% YoY. To sustain this momentum, India needs to work on ways to enhance its economic engagement with both traditional and new markets.
India-UAE relations are deep-rooted and built over at least a millennium of religious, cultural and economic engagement, fuelled by barter trade and people-to-people contacts over centuries. Besides having strong convergence with India on geo-strategic issues, the UAE is our third largest trading partner, with bilateral trade of US$ 43.3 billion in 2020-21.
F&B exports have been among the critical contributors to India’s trade basket, growing by 28.4% to US$ 18.02 billion during April-August 2021. In comparison, exports of F&B products to UAE during the period reached US$ 963.3 million, exhibiting a YoY growth of 32.5%.
UAE is undoubtedly a critical market for Indian F&B players to attract for multiple reasons, starting from the presence of the Indian diaspora itself. The Indian expatriate community is estimated at 3.42 million or 30% of the total population, making it the largest ethnic community in the UAE.
But apart from addressing the needs of the Indian diaspora, Indian agricultural exporters must focus on and understand the needs of other communities who are living here from over 200 nationalities.
In that regard, it is important to understand the current needs of the consumers here. Besides this, companies also have to understand what kind of promotional activities are required, so that they can communicate the value of their products. To diversify our product portfolio for international consumers based in the UAE and GCC, it is important for Indian companies to have a presence here. This will help them understand unique consumer dynamics of this market, like the value they attribute to organic products.
Some of the Indian companies could use Dubai as a testing ground to reach out to discerning consumers from different parts of the world. Moreover, it is a place where you have to compete with the best. We have noted that some of the Indian companies have good products, but lag in terms of marketing and packaging. That is where they can spend more effort, understand the requirements of the consumer and fill that gap. Also investing time and energy in a market becomes very important to understand the needs of the consumer and try to address his requirements.
Investing in the future of F&B
It is also very important to ensure that as Indian exporters and stakeholders in this industry, we are able to create clear projects for UAE investment to flow into India. We have been talking about the need for facilitating investments from the UAE into India. But the feedback we receive from the stakeholders here in UAE is that what they are looking for are clear investable projects.
When we talk about the food corridor, we understand that the COVID 19 pandemic impacted the pace of execution of these projects in the last 18 months or so. But going forward, we must do our best to make sure that we realize this opportunity. There is an investible surplus; both governments are committed and so are the other stakeholders. So we need to identify such clear investable projects in different parts of India and the irritants and bottlenecks to be identified and addressed, both by the public and the private sector.
It is also very critical is that we don’t look at the UAE as just a market of 10 million consumers. Instead, we look at it as a springboard for the entire MENA region. As we all are aware, Dubai is hosting the Expo 2020, which is slated as the biggest event to be hosted in this part of the world. In the last 170-year history of expos, it is the first time that the expo is being hosted in the MIASA region – the Middle East, Africa and South Asia region. I take pride in mentioning that we are expecting Indian nationals to be the single largest group of visitors at this expo for the first time in 170 years. So it is an opportunity for us to leverage this global platform to increase India-UAE trade and investment opportunities.
We are all aware how India has become a very fertile ground for the emergence of unicorns globally. The next six to eight months are going to be very critical, as India would be seeing the emergence of several unicorns in various sectors, including in the food and agri sector. There is a lot of funding coming from UAE into India in agri-tech startups, which we want to catalyse and facilitate. So, this is an opportunity to enable investment to go into these startups, which can actually address the global food challenges.
There are several challenges of growing food in arid conditions like those of the Middle East, and we must showcase the best of our startups at this global platform. This will enable them to connect with other stakeholders, counterparts from different countries and also with sovereign wealth funds, PE funds, venture capital funds and the other family holding companies based in the UAE.
So I would really emphasize for the sector to make use of this opportunity for supporting economic revival in both countries and globally. This event is expected be a harbinger for economic recovery in a post COVID-19 world order. Truly, India-UAE relations are at an inflexion point, especially in the food and agricultural sector. We need to work hard to be able to realize the true potential of this relationship.
The author is Consul General of India in Dubai. Views expressed are personal.
