India and UAE Sign Major Agreements with Focus on LNG and Nuclear

In a historic move, India and the United Arab Emirates (UAE) have recently concluded significant agreements to deepen their energy cooperation and strategic partnerships. The deals cover many sectors, including liquefied natural gas (LNG), nuclear energy, and crude oil. With Prince Sheikh Khaled’s arrival, India’s Prime Minister Narendra Modi exuberantly tweeted,

A New Dawn in India-UAE Collaboration

Crown Prince of Abu Dhabi, Sheikh Khaled bin Mohamed bin Zayed Al Nahyan’s visit to India marked a significant moment for both nations. PM Modi held extensive discussions on Monday with Prince Khaled that concerned strengthening the bilateral relationship between the two countries.

These agreements highlight the growing relationship between the two nations as they collaborate to enhance energy security, develop new technologies, and strengthen economic ties.

India and the UAE have always enjoyed cordial relations, with India increasingly including the UAE as a key partner in its geopolitical strategy. In 2022-23, bilateral trade between the two nations hit around USD 85 billion, highlighting their robust economic relationship. The thriving Indian community in the UAE further emphasizes the deep cultural and social links between the countries.

Both nations continue to emphasize the importance of exploring new areas of cooperation, ensuring mutual benefits, and fortifying their long-standing relationship. Let’s deep dive into the focal points of the pact.

UAE Powers Up India’s Energy Security

One of the key agreements focuses on enhancing the UAE’s participation in India’s Strategic Petroleum Reserves. This is a critical move, as the reserves play a vital role in securing India’s energy future. The Indian government actively involved the UAE in this effort, strengthening its energy security.

Meanwhile, a production concession agreement between Urja Bharat, a joint venture of Indian Oil Corporation Ltd and Bharat Petro Resources Ltd, and the Abu Dhabi National Oil Company (ADNOC) will allow India to bring crude oil from Abu Dhabi Onshore Block 1. This will significantly contribute to India’s energy security by ensuring a steady flow of crude oil.

Notably in 2004, India launched its Strategic Petroleum Reserves to boost energy security. The Indian Strategic Petroleum Reserve Ltd (ISPRL) has filled underground caverns with 5.33 MMT of crude oil at three sites, including 1.5 MMT in Mangalore. ADNOC has stored 5.86 million barrels of crude at the Mangalore site, ready for use during global supply disruptions.

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15-Year LNG Supply Agreement with ADNOC

Another breakthrough in the energy sector is the signing of a 15-year deal between ADNOC and Indian Oil Corporation Limited (IOCL). Under this agreement, ADNOC will supply 1 MMTPA of LNG to IOCL. This supply will come from ADNOC’s Ruwais gas project, which focuses on lower-carbon production.

The Ruwais project, which will be powered by clean energy, will consist of two plants with a combined capacity of 9.6 million tonnes of LNG per year. This development is expected to more than double ADNOC’s LNG output, increasing it to 15 million tonnes annually. ADNOC’s ambition to become a major player in the LNG market is evident as it competes with regional rivals like Qatar and Saudi Arabia. This agreement with India is the third long-term LNG supply contract that ADNOC has signed with Indian companies in just over a year, following similar deals with IOCL and GAIL.

Expanding Collaboration in Nuclear Energy

In addition to fossil fuels, the two nations are also eyeing opportunities in nuclear energy. According to the UAE’s official news agency, WAM, the Nuclear Power Corporation of India Limited (NPCIL) and the Emirates Nuclear Energy Corporation (ENEC) have signed a MoU that outlines a framework for the operation and maintenance of the UAE’s first nuclear power plant at Barakah.

Indian Ministry of External Affairs further confirmed that this partnership will allow India to share its expertise in nuclear technology and services and simultaneously explore investment opportunities in the UAE.

Media reports revealed that construction of the Barakah plant, located in Abu Dhabi’s Al Dhafra region, began in 2009. Last week the UAE announced the commercial launch of its fourth and final reactor, which is set to generate 40 terawatt-hours of electricity annually.

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Beyond LNG and Nuclear…

Apart from LNG and nuclear, both nations are also eager to collaborate on the latest technologies such as green hydrogen, artificial intelligence, and critical minerals. The MOU between The Abu Dhabi Developmental Holding Company (ADQ) and the Gujrat Government of India outlines plans to establish a food and agriculture park in Ahmedabad by the end of next year.

Image copyrights: carboncredits Data source: PM India

India’s External Affairs Ministry spokesperson Randhir Jaiswal also expressed himself on X, saying,

“A new milestone in a historic relationship. His Highness Sheikh Khaled bin Zayed Al Nahyan arrived in Delhi on his first official visit to India.”

This diverse collaboration highlights India and the UAE’s commitment to technological innovation and the shift to cleaner, sustainable energy. By focusing on reducing carbon emissions and embracing green technologies, both nations are positioning themselves as leaders in the global energy transition.

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