In Kochi, a port city on the Arabian Sea coast in the Indian state of Kerala, a Dubai company is trying to replicate an element of the emirate in the subcontinent.
Based on the models of Dubai Internet City and Dubai Media City, the 20 billion rupee (Dh1.37bn) SmartCity development, being built by Dubai's Tecom Investments, is designed as a hub for information technology, media and finance companies.
Tecom is just one UAE company striving to tap India's growing economy. Other major investors in India from the Emirates include Dubai's DP World, a ports operator, and Emaar, a property developer.
But doing business in India is far from easy.
"It is indeed challenging to do projects in India," says Baju George, the managing director of SmartCity, India.
"The system is more mature and rigid."
The 1.1 million square metre project has faced repeated delays since it was first announced in 2005 over obstacles including protests and disputes about land. But its investors say the development is going ahead and the first phase of the business park is expected to be operational within two years. A detailed masterplan for the entire development is scheduled to be ready in about month, Tecom says.
The "acceptance enjoyed by Tecom among the stakeholders in Kerala and progressive image of UAE in India has helped the project to tackle all challenges with a win-win outcome", says Mr George.
"The opportunity in India also is immense, especially in the knowledge-industry sector."
The project is 84 per cent owned by Tecom, while the remainder is owned by Kerala's government. It has the potential to directly create 90,000 jobs, its developers say.
The UAE is the 10th-biggest investor in India in terms of foreign direct investment, having injected US$2.2bn (Dh8.08bn), according to the Indian government.
DP World is the biggest container terminal operator in India, investing substantially in the country to capitalise on its economic and foreign trade growth in recent years. It declined to provide an investment figure. The company employs more than 2,200 staff in India.
"DP World has invested significantly in India's port infrastructure," the company says. "Our portfolio stretches across ports in Gujarat, Maharashtra, Kerala, Tamil Nadu, Andhra Pradesh and a new project in West Bengal.
"There is no other operator with the geographic reach and scale of investments we have in the country."
But DP World has also faced its fair share of difficulties in India.
The Dubai operator's Vallarpadam terminal in Kerala has struggled since it opened in February last year because the port was developed on an understanding that foreign ships would be able to transport container cargo between ports in India.
The necessary changes to the shipping law to allow this trade, however, have yet to be made and there is no indication of when, or if, this might happen.
Other companies have been badly burnt while operating in India.
Etisalat opted to leave the Indian market after the country's supreme court cancelled 122 second-generation, or 2G, licences, this year. They were issued to companies in 2008 but were cancelled because of a corruption scandal surrounding the sale of the licences. In February, Etisalat reported an impairment charge of Dh3.04bn because of the cancellation. Etisalat in March filed proceedings to the Bombay High Court for the winding up of its telecommunications business in India, which is an ongoing process. Etisalat declined to comment on its India venture.
Meanwhile, Emaar MGF was launched in 2005 as a joint venture between Emaar and MGF Development with the aim of focusing on high-end residential communities similar to some of the projects Emaar has developed in Dubai. But last year, Emaar reported a 2bn rupee loss in India for the previous fiscal year.
This loss included a 1.1bn rupee write-off on the sale of an investment in a Kolkata hotel project. Emaar MGF was also blamed by the Indian government for allegedly poor-quality construction and delays when it took on the Commonwealth Games village contract and became embroiled in a legal dispute with the Delhi Development Authority.
Emaar MGF has also struggled in its fund-raising efforts in the market and has scrapped repeated attempts to launch an initial public offering because of weak sentiment.
UAE retailers, meanwhile, seem to be having a better time and are ploughing ahead with expansion in India. Landmark Group recently announced a tie-up with Krispy Kreme, a coffee and doughnut chain, to take the brand to India.
LuLu Group, a supermarket chain based in the UAE, is building a huge development in Kochi, Kerala. The mall is slated to open by the end of this year.
"The project, which has a total investment of [16bn] rupees, envisages direct job opportunities for 8,000 people and indirect employment for more than 20,000 people," says V Nandakumar, a spokesman for the LuLu Group.
The group has further plans for India and intends to invest 40bn rupees in total in India over the next two years, Mr Nandakumar says.
"We have just commenced work on building India's largest convention centre and five-star hotel in association with Grand Hyatt at Bolghati, Kochi," he says.
"The construction of a logistic centre and cold-storage facility has begun and is expected to be operational in six months. Work is progressing on another convention centre in Calicut."
It seems the problems for UAE entities setting up in India are outweighed by the potential benefits.
business@thenational.ae
Sole survivors
- Cecelia Crocker was on board Northwest Airlines Flight 255 in 1987 when it crashed in Detroit, killing 154 people, including her parents and brother. The plane had hit a light pole on take off
- George Lamson Jr, from Minnesota, was on a Galaxy Airlines flight that crashed in Reno in 1985, killing 68 people. His entire seat was launched out of the plane
- Bahia Bakari, then 12, survived when a Yemenia Airways flight crashed near the Comoros in 2009, killing 152. She was found clinging to wreckage after floating in the ocean for 13 hours.
- Jim Polehinke was the co-pilot and sole survivor of a 2006 Comair flight that crashed in Lexington, Kentucky, killing 49.
The Vines - In Miracle Land
Two stars
Some of Darwish's last words
"They see their tomorrows slipping out of their reach. And though it seems to them that everything outside this reality is heaven, yet they do not want to go to that heaven. They stay, because they are afflicted with hope." - Mahmoud Darwish, to attendees of the Palestine Festival of Literature, 2008
His life in brief: Born in a village near Galilee, he lived in exile for most of his life and started writing poetry after high school. He was arrested several times by Israel for what were deemed to be inciteful poems. Most of his work focused on the love and yearning for his homeland, and he was regarded the Palestinian poet of resistance. Over the course of his life, he published more than 30 poetry collections and books of prose, with his work translated into more than 20 languages. Many of his poems were set to music by Arab composers, most significantly Marcel Khalife. Darwish died on August 9, 2008 after undergoing heart surgery in the United States. He was later buried in Ramallah where a shrine was erected in his honour.
8 traditional Jamaican dishes to try at Kingston 21
- Trench Town Rock: Jamaican-style curry goat served in a pastry basket with a carrot and potato garnish
- Rock Steady Jerk Chicken: chicken marinated for 24 hours and slow-cooked on the grill
- Mento Oxtail: flavoured oxtail stewed for five hours with herbs
- Ackee and salt fish: the national dish of Jamaica makes for a hearty breakfast
- Jamaican porridge: another breakfast favourite, can be made with peanut, cornmeal, banana and plantain
- Jamaican beef patty: a pastry with ground beef filling
- Hellshire Pon di Beach: Fresh fish with pickles
- Out of Many: traditional sweet potato pudding
The specs
Engine: 5.2-litre V10
Power: 640hp at 8,000rpm
Torque: 565Nm at 6,500rpm
Transmission: 7-speed dual-clutch auto
Price: From Dh1 million
On sale: Q3 or Q4 2022
Diriyah%20project%20at%20a%20glance
%3Cp%3E-%20Diriyah%E2%80%99s%201.9km%20King%20Salman%20Boulevard%2C%20a%20Parisian%20Champs-Elysees-inspired%20avenue%2C%20is%20scheduled%20for%20completion%20in%202028%3Cbr%3E-%20The%20Royal%20Diriyah%20Opera%20House%20is%20expected%20to%20be%20completed%20in%20four%20years%3Cbr%3E-%20Diriyah%E2%80%99s%20first%20of%2042%20hotels%2C%20the%20Bab%20Samhan%20hotel%2C%20will%20open%20in%20the%20first%20quarter%20of%202024%3Cbr%3E-%20On%20completion%20in%202030%2C%20the%20Diriyah%20project%20is%20forecast%20to%20accommodate%20more%20than%20100%2C000%20people%3Cbr%3E-%20The%20%2463.2%20billion%20Diriyah%20project%20will%20contribute%20%247.2%20billion%20to%20the%20kingdom%E2%80%99s%20GDP%3Cbr%3E-%20It%20will%20create%20more%20than%20178%2C000%20jobs%20and%20aims%20to%20attract%20more%20than%2050%20million%20visits%20a%20year%3Cbr%3E-%20About%202%2C000%20people%20work%20for%20the%20Diriyah%20Company%2C%20with%20more%20than%2086%20per%20cent%20being%20Saudi%20citizens%3Cbr%3E%3C%2Fp%3E%0A
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Match info
Uefa Champions League Group B
Tottenham Hotspur 1 (Eriksen 80')
Inter Milan 0
Notable Yas events in 2017/18
October 13-14 KartZone (complimentary trials)
December 14-16 The Gulf 12 Hours Endurance race
March 5 Yas Marina Circuit Karting Enduro event
March 8-9 UAE Rotax Max Challenge
FIXTURES (all times UAE)
Sunday
Brescia v Lazio (3.30pm)
SPAL v Verona (6pm)
Genoa v Sassuolo (9pm)
AS Roma v Torino (11.45pm)
Monday
Bologna v Fiorentina (3.30pm)
AC Milan v Sampdoria (6pm)
Juventus v Cagliari (6pm)
Atalanta v Parma (6pm)
Lecce v Udinese (9pm)
Napoli v Inter Milan (11.45pm)
