NEW DELHI, May 1 (Xinhua) -- The Comprehensive Economic Partnership Agreement (CEPA) between India and United Arab Emirates (UAE) on Sunday formally came into force, officials said.
The trade pact was signed between the two countries on Feb. 18.
India's Commerce Secretary B V R Subrahmanyam flagged off the first consignment of goods comprising of jewellery products from India to UAE under the India-UAE CEPA at a function in New Delhi.
The consignment, which will now attract zero customs duty under the CEPA agreement, is expected to reach Dubai on Sunday, an official statement said.
According to India's federal ministry of commerce and industry, the gems and jewellery sector contributes a substantial portion of India's exports to the UAE and is a sector that is expected to benefit significantly from the trade pact.
Overall, India will benefit from preferential market access provided by the UAE on over 97 percent of its tariff lines, which account for 99 percent of Indian exports to the UAE in value terms, the statement said.
Labor-intensive sectors will particularly benefit from the trade pact, such as gems and jewellery, textiles, leather, footwear, sports goods, plastics, furniture, agricultural and wood products, engineering products, pharmaceuticals, medical devices, and automobiles, it said.
Meanwhile, Indian service providers will have enhanced access to around 111 sub-sectors from the 11 broad service sectors, it said.
India's ministry of commerce and industry estimated that CEPA is expected to increase the total value of bilateral trade in goods to more than 100 billion U.S. dollars and trade in services to over 15 billion dollars within five years.
Speaking at the ceremony, the commerce secretary noted that India was also negotiating trade agreements with Britain, Canada and the European Union.
India's exports in goods and service during the last fiscal year reached 670 billion dollars, which constituted 22-23 percent of the country's GDP, he said.
