India’s trade agreement with the United Arab Emirates has come under renewed focus after gold bar imports from the Gulf nation recorded a massive jump following the implementation of the India-UAE Comprehensive Economic Partnership Agreement (CEPA).

According to trade data cited by NDTV Profit, gold imports from the UAE increased sharply from nearly $2.9 billion in 2022, before the CEPA agreement came into force — to around $16.5 billion in 2025, highlighting the growing role of the trade pact in India’s bullion market.

The India-UAE CEPA officially came into effect in May 2022 with the aim of boosting bilateral trade, investment and economic cooperation between the two countries. Under the agreement, India allows gold imports from the UAE at tariffs that are 1 per cent lower than the standard import duty, subject to an annual quota system.

The quota mechanism initially permitted imports of up to 120 tonnes of gold annually under concessional duty benefits. The quota is scheduled to gradually increase and is expected to reach 200 tonnes from 2027 onward. Officials estimate that this could account for more than one-fourth of India’s total gold imports in the coming years.

India remains one of the world’s largest consumers of gold, with strong demand driven by jewellery, weddings, festivals and investment purchases. The UAE, particularly Dubai, has long served as a major global trading hub for gold and precious metals due to its lower taxes and extensive bullion infrastructure.

The sharp rise in imports has now triggered discussions among industry experts and policymakers regarding the long-term impact of concessional tariff arrangements on domestic refiners, trade balances and customs revenue collections. Some market participants have also raised concerns about the possibility of import concentration through preferential trade routes.

However, trade officials maintain that the CEPA agreement has significantly strengthened bilateral economic ties between India and the UAE, with overall trade volumes expanding rapidly since the pact was implemented. Both countries have repeatedly described the agreement as a strategic economic partnership aimed at increasing non-oil trade and investment flows.

The latest figures come at a time when India’s gold demand remains strong despite global price volatility and geopolitical uncertainty affecting international commodity markets. Rising imports are also being closely monitored amid ongoing fluctuations in global bullion prices and currency markets.

GoldTrade | Business Upturn

India-UAE trade pact faces fresh scrutiny as gold imports surge nearly sixfold