LONDON: Sovereign wealth funds are piling into India, buying stakes in everything from airports to renewable energy, attracted by political stability, a growing middle class and reforms making it more enticing for foreigners to invest.
Wealth and state pension funds are expanding their horizons to private markets, to complement an existing focus on stocks and bonds.
“India is popular with sovereign wealth funds,” said Tihir Sarkar, London-based partner at Cleary Gottlieb, which counts several prominent sovereign funds as clients.
“Almost every jurisdiction in the western world is raising the bar for entry for foreign investors but in India it’s the other way round. There’s also the attraction of the demographics and a lot of assets that sovereign funds like, such as infrastructure, where there’s a huge appetite for foreign funding.”
Indian Prime Minister Narendra Modi’s election win last month consolidated his Hindu nationalist party’s power base and is expected to stimulate further foreign investment.
Foreign institutional investor flows into Indian equities are $11 billion year-to-date, surpassing the total annual tally in each of the four previous years and setting 2019 on course for the highest annual inflows since 2012. India’s benchmark BSE index has soared nearly 10 percent year-to-date.
“The rapid rise of an educated middle class offers enormous opportunities for the deployment of long-term capital, the kind that sovereign wealth funds are ideally suited to provide,” said Ravi Menon, chief executive officer of HSBC Asset Management India.
The attention sovereign funds are giving India is like that they have paid to China, now clouded by a trade war with the United States, said a banker specializing in institutional investors. In the public markets, funds were focused on public equity and fixed income, he said. In the private market, momentum is also building.
Private equity deal activity in India surged to $19 billion in 2018, the highest level in at least a decade, according to PitchBook data. Sovereign wealth funds and pension funds participated in about two-thirds of that amount.
Among recent deals, Singapore’s GIC sovereign wealth fund and the Abu Dhabi Investment Authority (ADIA) this month agreed to make a further investment of $495 million in renewable energy firm Greenko Energy Holdings, which has wind, solar and hydro projects.
India is widening its use of solar and wind energy to help reduce its reliance on fossil fuels.
In April, ADIA and India’s National Investment & Infrastructure Fund (NIIF) agreed to buy a 49 percent stake in the airport unit of Indian conglomerate GVK Power & Infrastructure.
Another wealth fund is in talks on an infrastructure investment, while Canadian pension funds are seeking similar deals, said a source familiar with the matter.
Canada Pension Plan Investment Board and GIC earlier this year participated in a $145.8 million buyout of Oakridge International School, an operator of schools in India.
ADIA, the world’s third-biggest sovereign wealth fund, which has been investing in Indian equities and fixed income for years, has broadened its focus to include asset classes such as infrastructure, real estate and private equities, said people familiar with ADIA’s thinking.
Its increased interest in India is driven by the country’s strong growth potential, positive demographics and continued economic development, the people said. More than half of India’s 1.3 billion population is aged under 25.
The push comes as India and the United Arab Emirates seek to strengthen economic and trade ties.
Regulatory reforms are also bolstering sentiment and drawing in wealth funds.
Indian-based fund managers were from this year licensed to manage foreigners’ portfolio holdings in the country, where previously such assets had to be managed outside India.
Prashant Khemka, founder of White Oak Capital Management which advises London-listed Ashoka India Equity Investment Trust, said that change had helped kick-start the onshore fund management industry for foreign-sourced funds.
“This could be looked back on as an inflection point in the growth of the Indian fund management business,” said Khemka, one of four fund managers to gain such an approval so far. Institutional names, including sovereign wealth funds and pension funds, account for around two-thirds of his clients.
Bankruptcy resolution rules introduced in 2016 helped pave the way for ADIA’s $500 million investment earlier this year in a distressed debt fund.
The investment was seen as an effort to launch a secondary market in India’s mountain of distressed debt and help ease the burden on local banks.
But some say more reforms are needed.
A source close to several wealth and pension funds said many would like to see the government further overhaul tax rules, building upon a new goods and services tax that is credited with helping cut red tape, and undertake land and labor reforms.
India becomes investment darling for sovereign wealth and pension funds
India becomes investment darling for sovereign wealth and pension funds
- Wealth and state pension funds are expanding their horizons to private markets
- The attention sovereign funds are giving India is like that they have paid to China
UAE shares end higher as outcome of US-China trade talks awaited
LONDON: Stock markets in the UAE ended higher on Monday, in step with Asian peers, as investors awaited the outcome of US-China trade talks in London in the hope that a deal could boost the global economic outlook.
Top US and Chinese officials will sit down in London on Monday for talks aimed at defusing the high-stakes trade dispute between the two super powers that has widened to export controls over goods and components critical to global supply chains.
Dubai’s benchmark index hit its highest levels since 2008 and settled up 1 percent, with almost all sectors in positive territory.
Tolls operator Salik Company gained 2.3 percent and Deyaar Development surged 14.6 percent.
In Abu Dhabi, the index was up for a third straight session and gained 0.1 percent, lifted by a 1.6 percent rise in blue-chip developer Aldar Properties and a 1.8 percent advance in Abu Dhabi’s flagship energy firm Abu Dhabi National Energy Company.
Most stock markets in the Gulf and Egypt including Saudi, Qatar, Kuwait are closed on Monday due to a public holiday.
Saudi commercial bank profits jump 16% in April, topping $2bn before zakat, tax
- Year-to-date earnings reached SR32.97 billion, an annual rise of 20%
- Banks getting balance sheets ready for next investment wave
RIYADH: Saudi Arabia’s banking sector extended its winning streak in April, posting SR7.77 billion ($2.07 billion) in pre-zakat and tax profits, a 16 percent increase compared to the same month last year.
According to the Saudi Central Bank, also known as SAMA, this brought year-to-date earnings to SR32.97 billion, an annual rise of 20 percent, keeping the Kingdom firmly on course for another record-breaking period.
The sustained momentum is attributed to a robust mix of state spending on giga-projects, resilient consumer demand, and still-elevated interest rates.
Financing volumes continue to climb, driven primarily by corporate borrowers across a growing range of industries, including manufacturing, utilities, insurance, and private education.
Contractors are also racing to secure long-term credit for giga-projects such as NEOM, Diriyah, and the Jafurah gas field.
A wider Gulf picture
Strong as those local figures are, the broader region is also gaining momentum. A Kamco Invest report released in May showed that Gulf banks collectively earned a record $15.6 billion in the first quarter of 2025, an 8.6 percent increase from a year earlier.
Financial institutions in the UAE posted the largest absolute increase, adding $639.6 million, while Saudi lenders recorded the fastest annual growth at 17.2 percent.
Kamco added that fee income is rising, costs are under control, and loan-loss provisions fell sharply during the period, cushioning a small dip in net interest income.
Investor appetite is visible in market valuations. Forbes Middle East’s “30 Most Valuable Banks 2025” March list includes 10 Saudi lenders with a combined market cap of about $269 billion— roughly one-third of the entire ranking.
Al Rajhi Bank led the pack at $105.6 billion, with Saudi National Bank following at $54.7 billion.
Global Finance named Saudi Awwal Bank the Kingdom’s best lender in its May “World’s Best Banks in the Middle East 2025” release, highlighting its HSBC-backed mobile app upgrades, Visa Direct payments, and one-stop small and medium-sized enterprises lending platform.
Cleaning the books and raising cash
Banks are also getting balance sheets ready for the next investment wave.
Bloomberg reported in March that lenders are exploring sales of older non-performing loans to specialist investors to free up capital for upcoming mega project drawdowns.
They’re also tapping capital markets. By June, they had issued over $5.6 billion in Additional Tier-1 bonds, already a full-year record and the world’s second-largest AT1 issuance in 2025, according to Bloomberg.
The spree includes Al Rajhi Bank’s $1.25 billion deal in April, Banque Saudi Fransi’s $650 million perpetual at 6.375 percent in May, Saudi Awwal Bank’s $650 million inaugural issue, and Alinma Bank’s $500 million of sustainable sukuk, all heavily oversubscribed.
By tapping eager investors now, while margins remain healthy and global demand for Gulf paper is strong, lenders are bulking up capital buffers and keeping loan-to-deposit ratios in check. That leaves them better prepared to fund the fast-rising credit needs of projects like NEOM and Diriyah without tripping liquidity alarms later in the year.
Fintech role
Fintech is reshaping Saudi banking from the ground up. The Saudi Central Bank’s Open Banking Framework — most recently updated in September to cover payment-initiation services — sets common technical rules that let lenders and start-ups plug their systems together safely and at speed.
Speaking at the inaugural 24 Fintech conference in September, Finance Minister Mohammed Al-Jadaan revealed that the Kingdom had licensed 224 fintech firms by the second quarter of 2024, up from fewer than 100 just three years earlier.
One of the newest players is Riyadh-based Stitch, which closed a $10 million seed round on May 28. The company offers a single set of application-programming interfaces that lets banks, fintechs and even non-financial brands bolt on real-time payments and open-banking functions far faster than older systems.
Early adopters already include Lulu Exchange and point-of-sale platform Foodics. The founders say the fresh cash will go toward doubling the engineering team and expanding the product suite.
Looking ahead
Riyad Capital’s first-quarter preview, released in April, expects another double-digit profit rise this year, about SR19 billion for the listed banks it tracks, as loan growth stays strong and rate cuts arrive slowly.
S&P Global, in its Saudi Arabia Banking Sector Outlook 2025 report, says a 10 percent increase in lending should outweigh a 20- to 30-basis-point dip in margins, keeping sector returns on assets near 2.1 percent to 2.2 percent.
Funding is the main watchpoint. Moody’s shifted its system outlook to stable on Feb. 25, saying strong credit growth is tightening liquidity, but capital buffers remain solid.
For now, asset-quality risks remain low. S&P expects non-performing loans to edge up to just 1.7 percent by the end of 2025, while loan-loss provisions are projected to stay around 50 to 60 basis points. Banks’ total capital ratios, hovering near 19 percent, provide a solid buffer to absorb potential shocks from falling oil prices or rising private-sector leverage.
Saudi lenders are still the region’s earnings workhorse. Profits are rising, market values are high, and fresh money — from bond buyers to venture capitalists — is flowing in. If they can keep gathering deposits quickly enough to fund a fast-growing loan book, the Kingdom’s banks look set to stay ahead of their Gulf neighbors in both profit and ambition well into next year.
Saudi carrier flynas to expand operations across 4 hubs, official says
- Hubs include Riyadh, Jeddah, Madinah, and Dammam as part of growth plan
- Carrier expanded its summer schedule, launching four new international destinations
RIYADH: Saudi Arabia’s low-cost carrier flynas is set to expand operations across its four main hubs — Riyadh, Jeddah, Madinah, and Dammam — as part of an ambitious growth plan, according to a top official.
In an interview with Al-Eqtisadiah, Waleed Ahmed, the company’s official spokesperson, said that flynas holds the largest aircraft order in the Kingdom and one of the biggest in the Middle East, with a total of 280 aircraft set to be received.
This follows a major deal signed in July with Airbus to acquire 160 new aircraft, including 30 wide-body A330neo and 130 single-aisle jets across A320neo, A321neo, and A321LR models.
The airline has seen a sharp rise in passenger traffic, with volumes climbing from around 11 million in 2023 to more than 14.7 million in 2024, reflecting the low-cost carrier’s rapid expansion in line with Saudi Arabia’s push to position itself as a leading global hub for tourism and business.
“These numbers reinforce the company’s role in supporting Vision 2030, which aims to increase the number of passengers to 330 million and attract more than 150 million international passengers by that year.” Ahmed said, as quoted by Al-Eqtisadiah.
He also highlighted that, as part of its ambitious strategic plan, flynas has expanded its summer schedule by launching four new destinations for the first time: Krakow in Poland, Geneva in Switzerland, Milan in Italy, and Rize in Turkiye, in addition to its usual summer routes.
Last week, flynas finalized its initial public offering at SR80 ($21) per share — the top of its indicated price range — following strong demand from both institutional and retail investors.
The pricing values the airline at an estimated market capitalization of SR13.6 billion at listing.
The offering followed the company’s announcement last month of its intention to float 30 percent of its share capital on the Saudi Exchange, making flynas the first airline in the Kingdom to go public and the first Gulf airline IPO in nearly two decades.
In line with its ongoing fleet expansion, flynas recently took delivery of its fourth Airbus A320neo of 2025, bringing the total number of A320neo aircraft in its all-Airbus fleet to 57. The current fleet includes 63 aircraft — 57 A320neo, four A320ceo, and two A330neo wide-body jets.
Al-Habtoor Group chairman to lead high-level delegation to Syria, exploring investment opportunities
Al-Habtoor Group chairman to lead high-level delegation to Syria, exploring investment opportunities
- Group said visit reflects its ongoing strategy to explore new cooperation with Syrian government
- Khalaf Al-Habtoor to visit Syria in coming days
RIYADH: The head of Dubai conglomerate Al-Habtoor Group is set to visit Syria with a delegation of senior executives to discuss potential investments and partnerships with the new government.
According to a statement, the visit reflects the group’s ongoing strategy to explore new avenues of cooperation with the Syrian government and to assess potential investment opportunities across multiple sectors.
It added that the trip stems from “a firm belief” in Syria’s ability to recover its strength and regional standing and the importance of public-private partnerships in the country’s rebuilding phase.
The move comes as Syria’s transitional government, led by President Ahmed Al-Sharaa, pushes economic reforms to attract foreign investment, including privatizations, relaxed trade policies, and major infrastructure deals.
Speaking ahead of the trip, the group’s Chairman Khalaf Ahmad Al-Habtoor said: “Syria is a country rich in culture, history, and capable people. We believe in its future potential and are eager to play a role in its revival through meaningful projects that generate employment.”
He added: “We look to Syria with great confidence. Its people possess the energy and resilience needed to shape a strong and prosperous future. As an Arab group with deep regional roots, we consider it both a moral and economic responsibility to stand as a partner in rebuilding stable and thriving societies.”
Al-Habtoor Group, a UAE-based multinational with a strong presence in the hospitality, real estate, and automotive industries, has a history of large-scale investments in the Middle East. The move follows the organization’s recent withdrawal from Lebanon, where it cited instability as a barrier to business.
Jordan’s foreign exchange reserves hold steady at $22.76bn in May
- Gold holdings at the end of May were valued at $7.76 billion
- Qatar Central Bank recorded a 3.6% increase in its foreign currency reserves and liquidity
RIYADH: Jordan’s foreign exchange reserves remained largely unchanged in May, standing at $22.76 billion, as per new data released by the Central Bank of Jordan.
The slight month-on-month dip — about 0.2 percent from April — reflects broad stability in the Kingdom’s external buffers.
Jordan’s foreign exchange figures are broadly in line with trends observed across other Middle East and North African countries.
The Qatar Central Bank recorded a 3.6 percent increase in its foreign currency reserves and liquidity, reaching 258.135 billion Qatari riyals ($70.9 billion) in May, up from 249.165 billion riyals in May 2024.
Egypt’s foreign exchange reserves rose to $48.525 billion by the end of May, compared to $48.144 billion in April, marking an increase of $381 million.
“The Central Bank of Jordan stated in a statement today that its total foreign reserves are sufficient to cover the country’s imports of goods and services for approximately nine months,” the Qatar News Agency reported.
The central bank also reported that gold holdings at the end of May were valued at $7.76 billion, totaling 2.345 million ounces, underscoring the role of bullion in Jordan’s reserve composition.
“It added that the presence of comfortable levels of foreign reserves enhances the ability to influence exchange rates, provides a stable economic environment, and enhances the confidence of foreign creditors and investors,” the QNA report stated, citing the Jordan Central Bank.
In May, Jordan’s long-term foreign-currency issuer default rating was affirmed at “BB-” with a stable outlook by Fitch Ratings, citing the country’s macroeconomic stability and progress on fiscal and economic reforms.
The US-based credit rating agency noted that the rating and stable outlook also reflect Jordan’s resilient financing sources — including a liquid banking sector, a robust public pension fund, and sustained international support.
Despite the stable outlook, Jordan’s credit rating remains below that of several other countries in the region. In February, Fitch affirmed Saudi Arabia’s IDR at “A+” with a stable outlook, while the UAE was rated “AA-.”
Fitch said the ratings are constrained by high government debt, moderate growth, risks from domestic and regional politics, as well as current account deficits and net external debt levels that exceed those of rating peers.
A “BB” rating indicates elevated vulnerability to default risk, particularly in the event of adverse shifts in business or economic conditions. However, it also suggests some degree of financial or operational flexibility in meeting commitments.
Fitch also noted that Jordan’s government remains committed to advancing its three-pillar reform agenda — spanning economic, public administration, and political sectors — despite external pressures.
The agency added that the pace of reforms will continue to be shaped by the need to preserve social stability, resistance from vested interests, and institutional capacity limitations.
