Investment and Mediation: The UAE’s Stake in Kashmir Stability

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The recent terrorist attack in Kashmir continues to draw global attention to one of the world’s longest-running and most complex territorial disputes.

The Kashmir Conflict: Sovereignty Disputed

The Kashmir conflict, primarily between India and Pakistan, is ongoing since the partition of British India in 1947. In turn, the division caused three full-scale wars and ongoing border skirmishes.

For the UAE, which maintains strategic partnerships with India and Pakistan, such developments carry significant geopolitical, economic, and security implications.

Kashmir, a Muslim-majority region divided between Indian-administered Jammu and Kashmir and Pakistan-administered Azad Jammu and Kashmir, remains a highly militarised zone.

India claims sovereignty over the entire region, while Pakistan views it as disputed territory.

Military Situation: State-Backed Insurgencies

This status quo is frequently disrupted by insurgent activities, cross-border shelling, and political unrest, often resulting in civilian casualties and military retaliation.

The latest attack, which Indian authorities attribute to Pakistan-based militant groups, is part of a broader pattern of violence between two nuclear-armed powers.

UAE’s Relationship with India

From a UAE, this escalation is not a distant issue but one that intersects directly with broader regional interests. The UAE has cultivated strong diplomatic and economic ties with India, becoming one of its largest foreign investors.

Trade between the two nations reached approximately $85 billion in 2023, making the UAE India’s third-largest trading partner. 

Major Emirati entities, such as Mubadala and DP World, invested in key Indian sectors including ports, logistics, renewable energy, and urban infrastructure.

Instability in South Asia, particularly a political instability in India, could threaten these investments and the broader economic partnership that both countries have worked to build.

UAE’s Relationship with Pakistan

Simultaneously, the UAE has in recent years expanded its cooperation with Pakistan, especially in areas of humanitarian aid, energy, and agriculture.

In 2024 alone, the UAE pledged over $1.5 billion in economic assistance and development funding to Pakistan, which continues to grapple with fiscal instability. 

Escalating tensions in Kashmir could further strain Pakistan’s internal cohesion whilst derailing development initiatives that the UAE supports.

Investment and Mediation: The UAE’s Stake in Kashmir Stability
Investment and Mediation The UAEs Stake in Kashmir Stability

Diplomatic Balancing Act

The diplomatic dimension is equally sensitive.

The UAE has historically advocated for de-escalation and dialogue, maintaining a position of constructive neutrality in global affairs.

In 2019, the UAE awarded Indian Prime Minister Narendra Modi its highest civilian honour, the Order of Zayed. Whilst tensions were high over India’s revocation of Article 370, which stripped Jammu and Kashmir of its special constitutional status, cooperation between the two countries continued.

Development, Aid, and Cooperation with Both Countries

This move sparked criticism from segments of the Muslim world, but the UAE defended its stance as a recognition of strategic partnership and mutual interests.

At the same time, the UAE continued humanitarian engagement in Pakistan whilst expressing concern over civilian casualties in conflict zones, calling for peaceful resolutions through dialogue.

Domestic Considerations: South Asian Diaspora in the UAE

The UAE’s significant expatriate populations from both India and Pakistan, totalling approximately 3.5 million and 1.5 million respectively, add another layer of complexity.

These communities not only contribute to the UAE’s economy through labour and entrepreneurship but also send billions of dirhams in remittances back to their home countries.

A flare-up in Kashmir could inflame communal tensions abroad and place pressure on the UAE’s internal social harmony, making stability in South Asia a domestic concern as well.

Geopolitical Considerations: UAE’s Evolving Role in Diplomacy

Abu Dhabi can also identifies geopolitical opportunities in South Asia.

The UAE's ascent, as a regional and global mediator, through the Abraham Accords and COP28, positions the UAE as a diplomatic host and potential mediator for conflict resolution between India and Pakistan.

The UAE could also extend its model of soft power diplomacy by investing in reconstruction and development projects in conflict-affected areas, with a focus on humanitarian aid, education, and renewable energy.

Human Cost of Prolonged Conflict

Kashmir remains a deeply emotional and political issue for both India and Pakistan, but the human cost of prolonged conflict is undeniable.

More than 70,000 people have reportedly died since the insurgency began in 1989, and hundreds of thousands have been displaced. 

The people of Kashmir, who often find themselves caught between military operations and separatist violence, deserve a future grounded in peace and dignity.

Abu Dhabi’s Valuable Role

For the UAE, maintaining a delicate balance between its economic ambitions, regional influence, and diplomatic values is essential.

While the Kashmir conflict is deeply rooted, the UAE’s role as a valuable broker, whether through back-channel diplomacy, economic investment, or humanitarian engagement, represents a meaningful channel for descalation between warring parties.

As the world becomes more interconnected, regional conflicts like Kashmir are no longer isolated.

Regional conflicts ripple across borders and markets, affecting the interests and security of nations far beyond their immediate geography.

The UAE, as a diplomatic broker and investment leader, is well-positioned to be part of the long-term solution.

Keep up with Daily Euro Times for more updates!

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Author

  • Ahmed Sharif Al Ameri is a Political Analyst, the President of Sheikh Mohammed Bin Khaled Youth Council, and Political Science Student at United Arab Emirates University.

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