UAE Pulls Out Of Islamabad Airport Deal After President’s Surprise India Visit

Islamabad: The United Arab Emirates (UAE), in a surprise move, has abruptly abandoned its plan to operate Islamabad International Airport. According to Pakistan's local media reports, the decision comes just days after UAE President Sheikh Mohamed bin Zayed Al Nahyan’s brief, high‑profile stopover in New Delhi, where he met Prime Minister Narendra Modi for barely 2 hours. The timing has ignited speculation that Abu Dhabi’s pivot toward India is reshaping regional economic and security calculations. The shocking development has been confirmed by Pakistan’s The Express Tribune.

According to reports, the airport venture, first mooted in August 2025, stalled when the UAE failed to secure a local partner and, according to sources, repeatedly delayed finalising the agreement, eventually losing interest altogether. While no official political rationale was given, the sudden withdrawal follows a flurry of Gulf‑wide realignments, including Pakistan's recently sealed defence pact with Saudi Arabia, dubbed by analysts as an ‘Islamic NATO’, while the UAE and Saudi Arabia are locked in a public confrontation over Yemen, backing opposing factions.

Meanwhile, against the backdrop, Sheikh Mohamed’s 2‑hour visit to India’s capital city produced a raft of new commitments. The Ministry of External Affairs (MEA) announced that India and the UAE agreed to increase cooperation in the defence sector and to strengthen strategic and security ties, signalling a deepening partnership that many observers now see as a direct counterbalance to Pakistan’s growing Saudi alignment.

The economic analysts warned that the airport setback could worsen Pakistan’s fiscal woes, already strained by political interference in state‑owned enterprises and a recent sell‑off of Pakistan International Airlines (PIA).

Meanwhile, India stands to gain from a more strong UAE partnership, with investments in infrastructure, energy, and technology. 

UAE’s Exit From The Islamabad Airport Project

As per the Pakistan media reports, the UAE’s “loss of interest” was not merely a technical hiccup but a strategic retreat. “The plan was shelved after the UAE failed to identify a local partner to whom airport operations could be outsourced, despite showing initial interest,” the paper noted, citing insiders who described repeated Emirati delays that ultimately caused Abu Dhabi to walk away. The decision shows a major loss of confidence in Pakistan’s infrastructure governance, even though the UAE has successfully managed airports in challenging environments such as Afghanistan.

A senior Pakistani official, speaking on condition of anonymity, said, “We were waiting for a clear response from the UAE, but they kept postponing. It’s a blow to our hopes of modernising the airport and attracting foreign investment.” The withdrawal has left Islamabad mulling alternative operators, with analysts warning that the episode could deter other Gulf investors wary of political volatility.

India‑UAE Strategic Surge

Sheikh Mohamed’s brief New Delhi stopover, though only 1 hour 45 minutes long, yielded concrete outcomes. “Both sides decided to explore collaboration in advanced nuclear technologies, including large reactors and small modular reactors, as well as joint initiatives on space infrastructure and a defence cooperation framework,” the MEA stated. A Letter of Intent was signed, laying the groundwork for a full‑fledged Strategic Defence Partnership.

PM Modi hailed the meeting as “a milestone in our Comprehensive Strategic Partnership, which has now entered a more ambitious and multidimensional phase.” He added, “We have agreed to set a target of $200 billion in bilateral trade by 2032, and to deepen our defence industrial collaboration, cyber‑security training, and counter‑terrorism efforts.” The UAE’s commitment to release 900 Indian prisoners was highlighted as a goodwill gesture, reinforcing the personal rapport between the two leaders.

Gulf Rivalry Of Saudi Arabia Vs UAE

The UAE’s focus comes at a time when its relationship with Saudi Arabia is under strain. Once close Gulf allies, Riyadh and Abu Dhabi now publicly back rival groups in Yemen, with Saudi Arabia pushing for a centralised Yemen and a ceasefire, while the UAE supports the Southern Transitional Council, which seeks autonomy. “The fragmentation of the anti‑Houthi coalition has created mistrust between Riyadh and Abu Dhabi,” noted a regional security analyst.

Meanwhile, Pakistan’s recent defence agreement with Saudi Arabia, described by some commentators as an “Islamic NATO", has further complicated dynamics. “Saudi Arabia is leaning on Pakistan’s military expertise, while the UAE is forging new defence ties with India,” observed a senior fellow at a Gulf think‑tank. The divergence appeared to have influenced Abu Dhabi’s calculus, making the Islamabad airport deal a casualty of broader geopolitical realignment.