Prices of several commodities and grocery items in the UAE are forecasted to decrease in the forthcoming months owing to abundant production and imports following anticipated good monsoon conditions in India.
India, a significant exporter of pulses, spices, rice, wheat, and other commodities to the UAE, has witnessed a substantial rise in trade following the signing of the Comprehensive Economic Partnership Agreement (CEPA).
According to the private weather forecasting agency Skymet, India is expected to experience a normal monsoon in 2024 with no impact from El Nino. The forecast anticipates satisfactory rainfall in India’s southern, western, and north-western regions. Punjab, Rajasthan, Uttar Pradesh, and Haryana, known as the agricultural heartland of north India, are pivotal in the farming sector.
India recently permitted an additional 10,000 tonnes of onions to be exported to the UAE shortly before Eid Al Fitr. Onion prices soared last year after India imposed a ban, skyrocketing from as low as Dh2-3 per kg to over Dh8 per kg.
Dr. Dhananjay Datar, chairman and managing director of Adil Group of Supermarkets, remarked that the new crop is of excellent quality, prompting the Indian government to allow exports to the UAE and other major trading partners.
Dr. Datar noted that the rice, pulses, millets, and spices such as chilli, turmeric, and coriander crops are particularly satisfactory this season, which is expected to positively impact local prices in the summer.
Additionally, there are certain additional duty concessions offered for food items imported from India to the UAE under the CEPA signed in 2022.
Increase in Indian Imports
Kamal Vachani, Group Director and Partner for Al Maya Group, foresees a substantial increase in imports from the Indian Subcontinent, driven by the robust agricultural output expected from India.
Vachani highlighted India’s crucial role as a trading partner, expressing optimism about the potential of this year’s monsoon to enhance the import portfolio. He anticipates a significant rise in the import of essential commodities, including rice, flour, spices, lentils, and various other consumer items.
India’s agricultural sector, heavily dependent on monsoon rains, is poised for a plentiful harvest, ensuring high-quality produce for export markets. Consequently, consumers in the UAE can anticipate an abundance of fresh fruits, vegetables, and spices directly sourced from Indian farms, leading to lower prices in the local markets.
Vachani added that the increased influx of Indian goods is expected not only to meet local demand but also to boost export activity to other countries in the region.
