Indian startups are increasingly choosing Dubai’s free zones as a base for expansion, attracted by the region’s strategic location and business-friendly environment.

The trend of Indian enterprises setting up in Dubai is notable, with these companies leading the list of new non-Emirati firms joining the Dubai Chambers. In the first nine months of 2024, Indian businesses established 12 142 new companies, reflecting a deepening relationship between India and the UAE, which is supported by the Comprehensive Economic Partnership Agreement (CEPA) signed between the two nations.

Dubai’s free zones have become essential for Indian startups and small and medium enterprises (SMEs) seeking international growth. These zones feature benefits such as 100% foreign ownership, tax incentives, minimal bureaucracy, and world-class infrastructure, making it easier for Indian entrepreneurs to establish a global presence. Key sectors benefiting from these favorable policies include fintech, AI, logistics, and e-commerce.

Taxation plays a significant role in the decision-making process for Indian entrepreneurs considering international expansion. Indian businesses face a complex corporate tax regime and an extensive goods and services tax (GST) framework, which can create barriers. Conversely, Dubai’s free zones offer zero personal income tax, full profit repatriation, and no customs duties on imports and exports, making them a more attractive option.

The United Arab Emirates boasts over 40 multidisciplinary free zones, with more than 20 located in Dubai alone. According to the United Arab Emirates Ministry of Economy, these zones are known for their world-class infrastructure, which streamlines business operations and saves time and effort for companies.

The Dubai Free Zones Council (DFZC) reported strong performance in 2024 for Dubai’s free zones, attributing this success to ongoing economic diversification and innovation, as noted by Emirates News Agency – WAM.

Dubai’s free zones offer a modern alternative to traditional bureaucratic processes, allowing companies to register in as little as five days through a digital-first approach. These zones provide comprehensive support, covering licensing, visas, office space, and banking solutions. Indian entrepreneurs benefit from complete ownership of their businesses without the need for a local sponsor.

Additionally, free zones like the Dubai International Financial Centre (DIFC) have established legal frameworks that facilitate seamless cross-border investments. This environment enables Indian entrepreneurs to access funding, mentorship, and strategic partnerships that enhance their global ambitions, free from restrictive foreign investment regulations.

Dubai’s exceptional logistics capabilities further position it as an ideal hub for Indian SMEs looking to reach markets in the Middle East, North Africa (MENA), and Europe. The Jebel Ali Port, the largest in the Middle East and one of the busiest globally, operated by DP World, serves as a vital trade gateway. Meanwhile, Dubai International Airport (DXB) connects over 200 destinations worldwide, enhancing the UAE’s role in the global supply chain.

The Jebel Ali Free Zone (JAFZA) is one of the world’s largest free zones, hosting thousands of companies and contributing approximately 24% of the total foreign direct investment (FDI) flow into Dubai. The Dubai Logistics Corridor, which connects Jebel Ali Port, Al Maktoum Airport, and logistics zones, allows for rapid goods transport and distribution, providing a significant advantage for logistics stakeholders.

The Dubai Multi Commodities Centre (DMCC) hosts around 25 000 companies, making it a popular choice for Indian businesses and SMEs seeking global expansion. The free zones offer a cost-effective platform for companies involved in manufacturing, e-commerce, and supply chain management.

As reported by MSN, Abhinav Chaudhary, CEO and Founder of Fero.ai, remarked, “Dubai’s advanced logistics ecosystem, including ports, free zones, and smart trade initiatives, has accelerated Fero.AI’s growth.” He highlighted that seamless connectivity and supportive government regulations have allowed the company to efficiently integrate AI solutions to optimize logistics operations.

Dubai’s commitment to technology and innovation has made it an attractive destination for Indian tech startups. Free zones such as Dubai Internet City and Dubai Silicon Oasis offer subsidized office spaces, R&D support, and funding opportunities tailored for deep tech, software as a service (SaaS), and blockchain ventures.

The UAE is forecasted to become a leading fintech hub by 2028, with a projected increase of fintech firms to 7,100—an increase of 1.8 times. At the Dubai Fintech Summit 2024, policymakers highlighted the Dubai Economic Agenda D33’s goal of positioning Dubai among the top four global financial hubs by 2033.

Indian startups in digital payments, AI-driven analytics, and blockchain are thriving in Dubai’s innovation ecosystem. Government-backed accelerator programs, such as Dubai Future Accelerators, connect these startups with investors, enterprises, and regulatory support systems. Chaudhary added that Dubai’s initiatives in AI and smart logistics have significantly influenced Fero.AI’s strategic direction, allowing for the development of tailored automation solutions.

As Dubai’s venture capital (VC) and private equity ecosystem expands, it presents an enticing opportunity for Indian startups seeking to raise capital. With over 70 VC firms and angel networks, the city is actively investing in sectors like fintech, AI, and SaaS. Indian companies make up a significant portion of Dubai’s innovation-driven startup ecosystem.

Government collaborations between India and the UAE are expected to enhance market access and investment opportunities further. Experts believe that AI and SaaS startups may see substantial growth as Dubai continues to push its digital economy agenda.

According to MSN, Mohan concluded, “Dubai isn’t just a regional hub; it’s a gateway to global growth.” He encouraged businesses to leverage free zones for easy establishment, tap into the local talent pool, and align with the region’s innovation goals, noting that Dubai rewards forward-thinking companies.

For Indian entrepreneurs interested in Dubai’s thriving business landscape, Chaudhary advised focusing on local partnerships, understanding compliance frameworks, and embracing the region’s tech-driven logistics vision, which are crucial for success in this dynamic market. As Dubai solidifies its position as a global innovation hub, Indian startups are poised to discover new opportunities within its vibrant economy.