Sheikh Mohammed Bin Zayed Al Nahyan had telephoned Prime Minister Narendra Modi and made the offer of assistance, the Chief Minister had said earlier.
"It is a great relief to the people of Kerala that so many kind hearted persons and social organisations across the country and overseas consider this disaster as their own matter (and) offered unbelievable help to us for managing this tragedy", added Chandy.
India's decision to refuse financial aid from other countries for the devastating floods in Kerala is a conscious, well-thought out policy that had been put in place for almost 15 years.
"I am sorry that the financial assistance announced by the government of India is quite disappointing as far as the magnitude of the crisis is concerned", Chandy said in a letter to Modi.
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Beginning with an aid offer of Rs 700 crore from the United Arab Emirates, there is rush for financial assistance from countries where Keralites are living in some numbers.
Kerala government maintains that as per the National Disaster Management Plan 2016, if a foreign country voluntarily offers help, the Union government may accept it. The decision, he tweeted, was that India needed no rescue teams or hand-holding, but the country was open to help for rebuilding houses, bridges, roads, etc.
As per the UAE's government's official website, in line with the directives issued by its leadership, a humanitarian relief campaign was launched, which included official institutions, citizens, residents and businessmen from India and the UAE to aid residents of Kerala.
Others privy to the thinking within the UPA government on refusing foreign assistance during the tsunami said a major concern was the presence of security installations along the affected areas. Sources in the central government said that even though India has declined their offer, the government has conveyed its appreciation to the foreign nations. This, however, is not the first time that India has refused help.
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"There is a lot of capacity in this state but what it lacks is the contextual experience because it has never dealt with a disaster of this magnitude before".
Several reports over the last two days have claimed that India will turn down the Rs 700 crore because of a 15-year-old convention on accepting foreign aid. "I hope they take a more positive attitude". In addition, it was also keenly campaigning among member countries for reforms in the United Nations and enlisting support for its place as a permanent member in the UN Security Council.
India has said individuals and foundations are welcome to send donations.
On the ground in Kerala, search and rescue operations have ended, but almost a million people remain in emergency camps. "But at the same time when our workers and agencies rescued 10,000 people they would often go unnoticed", he adds.
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The damages to roads, where over 10,000 km of the district, state, and national highways have been washed away, will be high as Rs 12,000 crore, while the figure for airports is almost Rs 40 crore, the report said.