The UAE and India moved from trade partners to strategic partners in eighteen months. The war finished the job.
Modi’s May 2026 visit turned goodwill into paperwork with legal effect. Here’s how the UAE-India axis got there.
When Prime Minister Narendra Modi left the presidential palace in Abu Dhabi on 15 May 2026 with a Strategic Defence Framework Agreement, a $5 billion Emirati development investment and fresh pacts on strategic petroleum reserves and LNG, the story was not really about diplomacy. It was about a bet that had been placed, tested and paid out: that the UAE-India relationship — quietly reshaped over four years of the Comprehensive Economic Partnership Agreement — could absorb a regional war and come out closer, not further apart.
That bet was decided in the twelve days between 13 and 24 June 2025, when Israeli strikes on Iran’s nuclear infrastructure, an American follow-through and Iranian retaliation across the Gulf rewrote every capital’s working assumptions. What emerged is now visible: a partnership that has moved from trading partner to strategic partner, from CEPA counterparty to defence signatory, and from one bilateral among many to arguably the most active axis between the Gulf and Asia.
The pre-war baseline: from pearl trade to preferred partner
The current relationship is often presented as new. It is not. The UAE and India have traded, remitted and migrated across the Arabian Sea for centuries. The modern relationship is roughly half a century old, and until recently it was defined by remittances and oil.
Bilateral trade in the 1970s was worth around $180 million a year, according to India’s Ministry of External Affairs. By FY2020-21, it stood at $43.3 billion — respectable growth, not transformative. The transformation began in February 2022, when the two sides signed CEPA in a record 88 days of negotiation and brought it into force by 1 May. The agreement removed tariffs on roughly 80 per cent of goods and set a target of $100 billion in bilateral trade within five years.
That target was hit early. In FY2024-25, trade crossed $100 billion for the first time. In FY2025-26, it reached $101.25 billion, and non-oil trade now accounts for close to two-thirds of the total. The UAE is India’s third-largest trading partner and its second-largest export destination after the United States; India is the UAE’s second-largest trading partner, contributing roughly 9 per cent of total trade and 14 per cent of non-oil exports.
Beneath the headline numbers, a quieter architecture was being built. In July 2023, the Reserve Bank of India and the Central Bank of the UAE signed an MoU to settle bilateral trade in rupees and dirhams rather than exclusively in US dollars; the first crude oil transaction under the framework followed within weeks. By mid-2026, India’s ambassador to the UAE, Deepak Mittal, told the Economic Times that more than 15 per cent of bilateral trade was being invoiced in local currencies. That is a viable alternative to the dollar-clearing system in one of the world’s fastest-growing trade corridors.
In February 2024, Modi and Sheikh Mohamed bin Zayed Al Nahyan launched the UAE’s domestic card scheme JAYWAN — built on India’s RuPay stack — and interlinked UPI with the UAE’s AANI instant payments platform. A Bilateral Investment Treaty was added later that year, alongside a UAE-India Virtual Trade Corridor in September and the MAITRI customs interface. This was not a relationship coasting on oil. It was being wired.
The Twelve-Day War: a stress test in slow motion
The Israeli strikes began on the night of 12-13 June 2025, targeting Iranian nuclear and missile facilities. Within hours, two things mattered most for the UAE-India relationship: the shared diplomatic instinct and the shared operational one.
The UAE Ministry of Foreign Affairs issued one of the region’s sharpest early statements, condemning Israel’s strikes “in the strongest terms” and warning against “uncalculated, reckless steps.” Foreign Minister Sheikh Abdullah bin Zayed worked the phones with regional and international counterparts, and Sheikh Mohamed himself called Iranian President Masoud Pezeshkian on 17 June, expressing solidarity with Iran’s people and pledging “intensive communication and consultations with concerned parties to de-escalate the situation.”
India’s line was calibrated but recognisably similar. On 13 June, the Ministry of External Affairs said New Delhi was “deeply concerned” and urged “both sides to avoid any escalatory steps,” pointing to “existing channels of dialogue and diplomacy.” On 14 June, India declined to associate itself with a Shanghai Cooperation Organisation statement condemning Israel’s strikes — a notable break with Beijing, Moscow and Tehran inside a bloc India had helped anchor. It had abstained a day earlier on a UN General Assembly resolution calling for a ceasefire in Gaza. Both moves drew heat from parts of the Indian commentariat, but for those reading the UAE-India axis, the signal was clear: New Delhi’s posture was tracking Abu Dhabi’s — measured, diplomatic, refusing sides.
Then came the practical test. Iran remained a passage route and workplace for tens of thousands of Indians; Israel hosted thousands more. On 18 June, India launched Operation Sindhu, initially routing 110 students out of northern Iran overland into Armenia. Over ten days, the mission grew to 4,415 evacuees — 3,597 from Iran, 818 from Israel — plus 14 OCI cardholders, 9 Nepali nationals, 4 Sri Lankans and one Iranian spouse of an Indian citizen. Nineteen special flights, three Indian Air Force C-17s, land routes through Armenia and Turkmenistan, and — after Iran reopened its airspace on 20 June at India’s request — evacuation flights from Mashhad. Zero casualties, zero injuries, zero missing.
What made Sindhu distinctive was not just scale but the way the UAE quietly slotted in behind it. When Strait of Hormuz disruptions began hitting Emirati imports and exports, India established what the Foundation for Defence of Democracies later described as an “air bridge” to the UAE, alongside a maritime corridor from Nhava Sheva to Fujairah and Khor Fakkan, carrying basmati rice, wheat flour, fruit, vegetables, medicines and toiletries. In the middle of a shooting war, one country was moving its people out and the other’s shelves in. Neither government made much of it at the time. Both knew what it meant.
The February escalation: solidarity becomes tested doctrine
If the June 2025 war stress-tested the relationship, the events of late February 2026 turned that test into a doctrine.
Iranian missile and drone strikes hit UAE territory on the night of 28 February — retaliation, Tehran signalled, for continuing US and Israeli operations against Iranian assets. Regional press reported at least four deaths and more than one hundred injuries across the UAE, Kuwait, Qatar, Bahrain and Oman. Three Indian nationals were among the injured; a Fujairah oil refinery reportedly caught fire.
Modi’s response arrived within hours. He convened the Cabinet Committee on Security, then called Sheikh Mohamed directly. “Spoke with the President of the UAE, my brother Sheikh Mohamed bin Zayed Al Nahyan,” he wrote. “Strongly condemned the attacks on the UAE and condoled the loss of lives... India stands in firm solidarity with the UAE in these difficult times.” The Emirati readout went further: Modi had affirmed India’s “rejection of the blatant Iranian attacks targeting the UAE” and expressed solidarity “in all measures it takes to safeguard its sovereignty, security and the safety of its citizens.”
That was a step change. Through the June 2025 war, India’s language had been symmetric. Once Iranian ordnance hit Emirati soil, symmetry ended. New Delhi condemned Iran by name, in solidarity with the UAE by name, and did so before speaking to Israel. When Modi called Prime Minister Benjamin Netanyahu two days later, he urged an early cessation of hostilities — a message the UAE could comfortably co-sign.
Between its historic ties to Iran and an accelerating partnership with the UAE, India moved with Abu Dhabi when a red line was crossed. Abu Dhabi had positioned itself so that when the line was crossed, India would move. The relationship had done exactly what it had been built to do.
The post-war acceleration: from partnership to framework
The visits that followed turned goodwill into instruments.
Sheikh Mohamed flew to New Delhi on 19 January 2026 with senior ministers and royal family members and left with a portfolio anyone watching Gulf-Asia diplomacy for two decades would have called improbable a few years earlier. A Letter of Intent on a Strategic Defence Partnership, exchanged between Sheikh Abdullah bin Zayed and Indian External Affairs Minister S. Jaishankar. A $3 billion LNG deal. A commitment to double bilateral trade to $200 billion by 2032. A food security pact. Civil nuclear cooperation.
Modi’s return visit on 15 May 2026, en route to Europe, converted the LoI into a full Strategic Framework Agreement on defence cooperation, covering defence industrial collaboration, advanced technology, training, doctrine, special operations, interoperability, cyber defence and secure communications. In parallel: a strategic petroleum reserve cooperation agreement between ISPRL and ADNOC, an expanded LPG arrangement and a $5 billion Emirati development investment.
Read those two visits together, and the picture is clear. The UAE and India are no longer building a bilateral. They are building a small, deliberate architecture — commercial, financial, energy, defence, technology — that assumes a Gulf in which resilience matters more than optimisation, and in which the two countries plan to hedge each other’s exposures. The 13th India-UAE Joint Defence Cooperation Committee met at the Secretary level for the first time in July 2025, in the immediate aftermath of the war. That upgrade was not accidental.
The wider regional frame matters too. The I2U2 grouping — India, Israel, the UAE and the United States — went dormant through the worst of the Gaza war and has, on the reading of regional analysts, re-emerged as a working security bloc. The India-Middle East-Europe Economic Corridor announced at the 2023 G20 remains, on the honest assessment of the Middle East Institute and Atlantic Council, largely on hold in its full trans-regional form. But its eastern leg — India to the UAE — is moving at speed, backed by the March 2024 intergovernmental framework agreement, the September 2024 UAE-India Virtual Trade Corridor and the MAITRI customs interface due to go live on the corridor by 2026. Whatever IMEC becomes, the UAE-India segment is being built now on national timetables and does not depend on Saudi-Israeli normalisation to progress.
Sensitivities, and the honest ones
No honest account of this relationship omits three caveats.
The UAE and India do not agree on Gaza. India’s abstentions from UN General Assembly votes on ceasefire resolutions have irritated Arab counterparts who supported them. Both governments manage the difference the way mature partnerships do: by not making it the headline.
Reports have also circulated — in documents cited by Indian outlets in July 2026, and Israeli press reporting around a BRICS forum earlier in the year — alleging Emirati facilitation of Israeli operations in Gaza, and covert Emirati and Saudi strikes on Iranian military and energy sites in April. The claims are contested and, in places, contradicted by the UAE’s own public condemnations of Israeli conduct in Gaza. They belong in the piece as reporting, not verdict, and matter because they show how narrow the diplomatic corridor has become for a country holding ties with Israel, Iran and India simultaneously.
And there is Iran itself. The UAE ambassador to India, Hussain Hassan Mirza, told NDTV earlier this year that “there is no reason for the UAE to be involved” in the Iran-Israel confrontation, that Emirati territory would not be used as a launch pad, and that Modi was uniquely placed to help end the war with “just one phone call.” Flattering framing — and a real reading of where the two countries now sit, with credibility in Tehran, Tel Aviv and Washington, and reasons to use it.
What to watch
Three lines to follow through the autumn. First, the $200 billion trade target by 2032 requires non-oil trade to keep growing at close to its H1 2025 pace of nearly 34 per cent year-on-year, and CEPA’s diversification story — pharmaceuticals, engineering goods, jewellery, agri-products, services — to keep broadening. Second, the defence-industrial content of the Strategic Framework Agreement will earn its keep only when specific joint ventures, technology transfers and training rotations are signed; watch the next JDCC. Third, and hardest to read, is what happens if the Iran file re-opens. If Hormuz closes again — as it briefly did in July 2025 and again during phases of the war — the air bridge, the maritime corridor and the strategic petroleum cooperation will be tested for real, not exercise. That is the moment the framework earns or loses its keep.
The UAE-India relationship is now the most instrumented bilateral in the Gulf’s Asia file: trade agreements, currency settlement, digital rails, defence framework, energy stockpiling, evacuation protocols, and a habit of talking first when things go wrong. Ordinary partnerships build one or two of these. This one has built the set. The Twelve-Day War did not create the partnership. It confirmed it — and that is the story Emirates Wire’s readers, in Abu Dhabi, Dubai, London and Mumbai, are already living inside, whether or not they have yet seen it named.
Sources
Ministry of External Affairs, Government of India: PM Modi UAE visit, May 2026; MBZ India visit joint statement, January 2026; Operation Sindhu, 27 June 2025; India-UAE Bilateral Relations 2026 brief
PIB India: India-UAE CEPA at three years; Third CEPA Joint Committee; 13th India-UAE JDCC; JAYWAN/RuPay collaboration
UAE Ministry of Foreign Affairs: Statement condemning Israeli strikes on Iran, 13 June 2025
Reserve Bank of India: INR-AED Local Currency Settlement MoU
Reuters: India-UAE defence and petroleum pacts, May 2026; $3bn LNG deal, January 2026; UAE warns against reckless steps
The National: Inside the UAE-India strategic defence push
Indian Express: Modi condemns attacks on UAE; Strait of Hormuz closure and UAE minister remarks; Why defence dimensions became central to India-UAE ties
Gulf News: Modi condemns UAE attacks, Strait of Hormuz
The Diplomat: India signals reluctance to call out Israeli aggression
Al Jazeera: India-UAE defence pacts as Iran war tensions simmer; Why India refused to join SCO condemnation
Jewish Insider: Iran war and Israel-India-UAE alliances
Middle East Briefing: India-UAE CEPA non-oil trade
CEPA Council: Four Years of the UAE-India CEPA report
EnterpriseAM: Local currency share exceeds 15% of India-UAE trade
Atlantic Council: IMEC connectivity report
Middle East Institute: IMEC backgrounder, June 2026
The Tribune: Air bridge to UAE and maritime corridor from Nhava Sheva
RealClearWorld: Bloc realignment in the Middle East
Times of Oman: UAE-India CEPA at four, $101.25bn
How this piece was made
Research was AI-assisted, drafting was AI-supported, editing and fact-checking were done by hand. Every figure, date and quotation in the piece has been checked against the primary source cited below, with priority given to Indian and UAE government statements, RBI and MoFA releases, and named regional reporting. Contested claims are labelled as such. The full source list follows. Emirates Wire’s standing methodology is on the About page.