India’s significant economic transformation positions it as a leading global growth center in the coming years, according to a Dubai Chambers report released during the recent Dubai-India Business Forum. Several promising sectors in India present strategic opportunities for UAE investors amid increasing economic cooperation between the two nations.
Cooperation and investments between the UAE and India are expected to continue growing in light of the Comprehensive Economic Partnership Agreement (CEPA), which was signed in 2022, and marked the UAE’s first bilateral agreement under its CEPA program.
India is also emerging as a key market for investors, with projections indicating that its economy is on track to grow by an average of 6.5 percent per year between 2025-26, positioning India among the world’s fastest-growing major economies.
India’s car market to expand
India is home to Asia’s second-largest new car market after China, with annual unit sales posting a strong recovery over the past three years, making it one of the most attractive opportunities for UAE investors. The segment is expected to expand at a compound annual growth rate (CAGR) of 3.3 percent, with annual sales approaching 5.2 million units during 2024-29.
Electric vehicle sales are also projected to increase at a CAGR of 16 percent between 2024-29 but will account for only 4 percent of total new car sales by 2029.
Retail sector offers new growth opportunities
With its large population, India is also a substantial consumer market and a key attraction for retailers and luxury brands. Private consumption accounts for 57.5 percent of the GDP, making the retail sector a key pillar of employment and economic growth.
The Dubai Chambers report highlights that retail and e-commerce expansion is shifting beyond major urban centers to smaller cities, where rising purchasing power and high smartphone penetration are unlocking new growth opportunities.
Banking and finance sector to post robust growth
In addition, India’s financial services sector has shown a strong recovery in recent years, with banks recording three consecutive years of record profits (2021–23), making it another key sector UAE investors are eying. This positive momentum is expected to continue, with non-performing loans (NPLs) steadily declining. Profitability is also expected to rise further between 2025 and 2029, supported by robust growth in retail banking lending.
Furthermore, India’s insurance market is set for strong growth, driven by an expanding middle class, innovation and regulatory support. Total insurance premiums are forecast to increase by 7.1 percent in real terms from 2025–29, positioning India as the fastest-growing insurance market among G20 countries.
The report also highlights that the financial technology (fintech) sector is continuing to disrupt traditional financial services, emerging as a key channel for credit, insurance and investment products. India currently hosts the world’s third-largest fintech ecosystem by number of operating entities, with a fintech adoption rate of 87 percent. This is significantly higher than the global average of 67 percent.
Prominent digital healthcare market
Another sector offering attractive opportunities for UAE investors is India’s healthcare market. Total healthcare spending in India is projected to grow at a 9 percent CAGR between 2025 and 2029, driven by increased government spending and greater adoption of private health insurance.
India is a prominent digital healthcare market, witnessing public-private partnerships in areas such as artificial intelligence, telemedicine and medical imaging.
National infrastructure program triggers boom
Under its national infrastructure program, India is currently undertaking over 13,000 projects valued at over $2.3 trillion, spanning roads, bridges, power plants, railways and ports. Infrastructure-specific programs are also creating a significant impact, particularly the National Infrastructure Pipeline (NIP), which supports infrastructure project development. The NIP currently includes 13,214 projects with combined investments of $2.3 trillion.
According to BMI Infrastructure Key Projects Data, India holds large project pipelines in industrial construction, power, road and rail infrastructure. Industrial sectors are a high priority within these ongoing projects, creating opportunities for strategic partnerships with UAE technology and infrastructure companies.
