India deepens defence, energy ties with UAE during PM Modi visit

The two countries also signed pacts on strategic petroleum reserves and supply of liquefied petroleum gas during a visit by Prime Minister Shri Narendra Modi to the UAE, it added. “The two ​sides have agreed on deepening defence industrial collaboration and cooperation on innovation and advanced technology, training, exercises, maritime ​security, cyber defence, secure communications and information exchange,” the ministry said in a statement.

Ahead of the visit, ⁠Indian sources told Reuters that Modi was likely to discuss long-term energy supply deals and also seek support to expand New ​Delhi’s strategic oil reserves. The UAE’s decision last month to leave OPEC is expected to boost its output and help importers such as ​India. 

The Iran war has roiled global energy markets with the closure of the Strait of Hormuz, disrupting transportation and business across the region as Iranian strikes hit Gulf states, including the UAE, before a fragile ceasefire last month. The oil pact announced on Friday includes a potential increase of ADNOC’s ​crude oil storage in India for up to 30 million barrels, Abu Dhabi’s state oil firm said in a separate statement, ​adding the deal also explores potential crude storage in the UAE’s Fujairah as part of India’s strategic reserve.      ADNOC said that it would explore ‌expanded LPG ⁠supply and trading opportunities with Indian Oil Corp.

“India’s scale and growth trajectory make it one of the defining energy markets of our time. As demand accelerates alongside a rapidly expanding population, the strength of the UAE India energy partnership becomes ever more critical,” ADNOC managing director and CEO Sultan Ahmed Al Jaber said.

New Delhi and Abu Dhabi signed a $3 billion deal ​for India to buy LNG ​from the UAE, its third-largest ⁠trading partner, in January, as well as a letter of intent to work towards forming a strategic defence partnership.  That followed a mutual defence accord that Pakistan, India’s arch-rival neighbour,  with Saudi Arabia ​last year.   Pakistan has emerged as the key mediator between Washington and Tehran to end the ​war which began ⁠with U.S. and Israeli strikes on Iran on February 28. It has also moved to shore up Saudi Arabia’s defences after the kingdom came under hundreds of Iranian missile and drone attacks.      Riyadh said last month it would provide $3 billion in additional support to help Pakistan bridge ⁠a multi-billion-dollar ​financing gap linked to a debt repayment to the UAE. The Indian ministry ​also announced UAE investments worth $5 billion on Friday, (15 May) pointing to past deals including Emirates NBD’s acquisition of a 60% stake in RBL Bank last year for $3 billion, ​and Abu Dhabi’s IHC $1 billion Sammaan investment.