Historically, relations between the United Arab Emirates (UAE) and Russia have been relatively relaxed, with limited economic exchanges and cautious political engagement. However, the past two decades have seen a notable shift. The two countries recognize that close cooperation will bring mutual benefits in both economic and geostrategic terms.Economically, for the UAE, this transformation took place in the context of a broader international strategy launched in the early 2000s. This strategy focused on diversifying the country’s economy away from oil and exploring new opportunities in emerging markets; Russia was one of them. For Russia, the UAE was a strategic location as a trade hub connecting Europe, Asia and Africa, and facilitating access to Middle Eastern markets. Starting in the late 1990s, Moscow began to strengthen its partnerships with Arab countries. Russian exports to the emirate increased significantly, and cities such as Dubai and Abu Dhabi saw an increase in the Russian diaspora, made up of business professionals, skilled workers and entrepreneurs, attracted by the dynamic economies and investment opportunities of these cities.
In recent years, relations between the two countries have reached a new level. Deep economic, political and strategic tiesAgainst this backdrop, the UAE has significantly stepped up its investments in Russia (especially in areas such as energy, infrastructure, real estate and technology) and strategic dialogue with Moscow, as it seeks to expand its international role, including on the Asian continent. At the same time, the UAE has emerged as an important partner for Russia, especially since the Russian invasion of Ukraine in February 2022. What is the UAE planning in Russia, and what is Russia planning in the UAE? What are the main drivers, features and prospects of this expanding partnership?
Driving force behind UAE investment in Russia
A key driver for the UAE’s investments in Russia has been the pursuit of a diversified economic portfolio, in line with the country’s strategy to diversify both across economic sectors and international partners. UAE sovereign wealth funds (SWFs) such as Mubadala Investment Company and the Abu Dhabi Investment Authority (ADIA) have been at the forefront of this effort. These entities have invested heavily in a range of Russian sectors, including energy, technology, infrastructure and agriculture.
In Energy SectorIn the energy sector, particularly oil and gas, UAE investments in Russian projects have been substantial. Already in 2013, Mubadala established a co-investment program with the Russian Direct Investment Fund (RDIF) to jointly invest in projects such as the development of Siberian oil fields and the construction of a high-tech innovation center in Skolkovo. In addition, Mubadala has acquired significant stakes in several Russian energy companies, including a notable investment in Gazprom Neft in 2020. Another significant investment by Mubadala is the development of the Arctic LNG 2 project, a large-scale liquefied natural gas (LNG) initiative that will boost Russia’s LNG production and export capacity.
Another interesting area is Technology and InnovationIn recent years, the UAE has been particularly keen to develop its high-tech industry, and Russia’s advanced technological capabilities have provided good collaboration opportunities. For example, Mubadala has partnered with RDIF to invest in promising Russian technology companies, such as Yandex, Russia’s largest technology company, known for its internet-related services. In addition, it also focuses on artificial intelligence and machine learning, and has invested in the Skolkovo Innovation Center, known for its tech incubator and research facilities. Another notable collaboration is Space ExplorationThe UAE and Russia signed an Intergovernmental Agreement (2021) to cooperate on space missions and satellite technology, leveraging Russia’s extensive experience in space research and the UAE’s ambitious space programme.
Investment destination Infrastructure and logistics UAE-Russia cooperation is also crucial in strengthening economic ties between the two countries. The UAE is investing heavily in Russia’s transport and logistics sector, aiming to strengthen trade routes between the two countries and beyond. For example, DP World, a leading UAE-based port operator, already entered into a joint venture with RDIF in 2016 to develop port terminals and logistics infrastructure in key areas of Russia, such as the Baltic Sea and the Far East, which are important for connecting Russia to global market routes. In 2023, DP World also signed an agreement with Russian state-owned Rosatom to develop the Northern Transport Corridor. These partnerships aim to create a sustainable sea route between Asia and Europe via the Arctic, significantly reducing transport times and environmental impacts. Also known as the Northern Sea Route (NSR), the route could reduce sailing times between Southeast Asia and Northwest Europe by up to 19 days compared to traditional routes.
UAE companies are also contributing to Russia’s modernization. AgricultureIt has become an increasingly important area of cooperation between the two countries. With its vast arable land, Russia is a major agricultural producer, and the UAE’s investments in the sector are aimed at ensuring food supplies for its citizens and promoting the exchange of agricultural technologies. For example, the Abu Dhabi Investment Authority (ADIA) is funding large-scale agricultural and food production projects in Russia. The focus on agribusiness has led to an increase in Russian agricultural exports to the UAE, including staples such as wheat, barley, pulses and chicken.
Russian interests in the UAE
All these investments and joint ventures prove that the UAE is interested in partnering with Russia in different sectors and in different ways. Russian companies are expanding their presence in the UAEbenefiting from its status as a global trade and financial center. This development was clearly evident in the two years (2022-2024) following Russia’s invasion of Ukraine. Russian exports to the UAE almost doubled, with trade increasing from $4.61 billion in 2021 to $8.07 billion in 2022. Within a few months, this change made the UAE Russia’s seventh global trading partner after China, India, Turkey, Kazakhstan, Japan and South Korea, and also classified the UAE as the first Arab country for Russian exports of goods and daily necessities.
Cultural and social exchanges have also played a role in strengthening ties between the UAE and Russia. sightseeing Tourism from Russia in particular has seen impressive growth, with direct flights and a simplified visa regime making travel more accessible: Dubai is expected to welcome an estimated 474,000 Russian tourists between January and April 2023, making Russia one of the largest sources of visitors. Educational Cooperation Russia-UAE cooperation is also thriving, with student exchange programs, joint research projects, and academic partnerships. Russian universities welcome Emirati students and Emirati institutions host Russian scholars, fostering academic and cultural ties. The opening of an UAE lecture hall at Moscow’s MGIMO University in 2023 (with Foreign Minister Lavrov in attendance) and Plekhanov University’s planned open day event at Dubai Knowledge Park in 2024 are small signs of growing cooperation in this area.
But most importantly, Russian companies in particular saw the UAE as a “safe haven” from Western sanctions. Many Russian banks have moved their funds to the UAE to protect themselves against potential seizures and continue their operations without the constraints of European regulations. Russian investments, especially in Dubai’s real estate market, have increased dramatically, with Russians spending around $6.3 billion on real estate in 2022, making them the largest non-resident buyers of residential real estate in the emirate. Such investments have also encouraged many Russians (mostly oligarchs and wealthy citizens) to relocate to the country. UAE ports have also welcomed luxury yachts and private jets owned by some of Russia’s most prominent oligarchs, who are under sanctions. The UAE’s welcoming policy, designed to attract wealthy foreign investors from around the world, is particularly attractive to Russians, allowing them to continue their business activities unhindered while providing a practical solution for Russians to flee the country.
The political dimension of the growing UAE-Russia partnership
Looking to the future, UAE-Russia relations look bright. The continued diversification of the UAE’s investment portfolio, coupled with Russia’s need to strengthen its partnerships with non-Western countries, lays the groundwork for the sustained growth of bilateral relations. This is all the more true as, beyond economic interests, broader political considerations greatly nurture the UAE-Russia partnership. Over the past few years, and especially since Russia’s invasion of Ukraine, the two countries have shared common views on security developments both in the MENA region and in global affairs. The two countries have aligned their approaches to various regional conflicts, such as Libya and Syria, and coordinated in diplomatic efforts. Their cooperation extends to defense, counter-terrorism, and regulating global oil markets. The two countries have met in various international forums and have often demonstrated that they share similar visions on major global challenges, primarily the Shanghai Cooperation Organization (where the UAE was granted dialogue partner status in 2023) and the BRICS bloc, which the UAE, along with Saudi Arabia, formally joined in January 2024. The UAE’s participation in such multilateral forums, where Russia is a key partner, is particularly symbolic of this deepening alliance. The expansion of these forums reflects a mutual interest in strengthening UAE-Russia ties as well as fostering economic and political cooperation outside of Western-led frameworks. Indeed, it is no coincidence that the dynamics of Russia-UAE relations are under increasing international scrutiny.
