INDIA: The United Arab Emirates (UAE) is considering spending $50 billion in India, its second-largest trading partner, as part of a larger wager on the world’s fastest-growing economy. The UAE may make preliminary commitments early next year, according to reports.
UAE President Sheikh Mohammed bin Zayed and Indian PM Narendra Modi are potentially set to discuss additional investments after their talks in July. The two nations aim to double their non-oil bilateral trade to $100 billion over the next ten years. Modi has visited the UAE five times since 2014, the most recent being this past weekend. Prior to Modi, Indira Gandhi was the previous Indian prime minister to visit the UAE in 1981.
The insiders stated that agreements involving interests in important state-owned businesses and infrastructure projects in India are being explored. Announcements are probably going to come before Modi runs for a third term in the upcoming federal elections. They added that sovereign wealth funds like ADQ, Mubadala Investment Co., and Abu Dhabi Investment Authority might be involved in some of the investments.
The people stated that it is unlikely that a significant portion of the investments will have defined timeframes in the promises. Regarding the scope and timing of the announcements, no final choices have been made.
Sheikh Tahnoon bin Zayed Al Nahyan’s organizations are reportedly discussing billion-dollar investments in India. Sheikh Tahnoon, brother of the UAE President, assumes the role of chairman of International Holding Co., announcing a 5% stake in Gautam Adani’s flagship group.
Days later, IHC reduced its ownership stake in two Adani firms, although, at the time, the company reaffirmed its commitment to India.
According to Bloomberg, Royal Group executives have long praised India, referring to it as a possible growth engine for the ensuing ten years. In addition, Sheikh Tahnoon serves as chairman of ADIA, one of the biggest wealth funds in the world, and ADQ, which together have assets close to $1 trillion.
Investors from Gulf states are strengthening their connections with India due to the country’s growing middle class and their desire to diversify away from traditional investment destinations like Europe.
Other notable investors in the nation include the Public Investment Fund of Saudi Arabia and the Qatar Investment Authority. The UAE’s strategy is just another example of the government’s efforts to project an image of neutrality on a globe that is becoming more and more divided between Beijing and Washington.
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