India has become the centre of the world’s oil demand growth and the country’s economic expansion will affect global commodities, Citigroup said in a research note.
The world’s second-largest country by population after China will see its economy expand at about 8 per cent a year through 2021, Citi researchers including Ed Morse said. The country’s working-age population will increase by 220 million over the next 20 years, and about 240 million people will move to cities.
Urbanisation and rising incomes will boost demand for transportation fuels, gold jewellery and electricity generation, while looser regulations should spur increased exports of iron ore into the market. India’s economy won’t copy China’s near-decade of double-digit economic growth that pushed oil prices into the US$100-a-barrel range, but will be enough to impact global supply-and-demand balances of several commodities, Mr Morse said.
“While India is no China, the sub-continent’s largest economy is becoming the third-largest oil consumer and importer of oil, with a tangible impact on oil, coal and iron ore markets, less so on metals,” Mr Morse said. “As India’s base rises, so too should its global commodities’ impacts.”
Citi expects 2016 to be the best in four years for commodity investments. The Bloomberg Commodity Index is up 7.4 per cent this year. Oil, zinc, copper and soft commodities will be the best investments in 2017, with Brent crude seen averaging $60 a barrel after ending this year around $50.
India’s crude demand has grown by 350,000 barrels a day this year, higher than China, as the country surpassed Japan to be the world’s third-largest oil buyer. Petrol demand has risen 14 per cent this year and should continue to increase at double-digit rates as car and motorcycle purchases climb, Mr Morse said.
Coal demand will grow between 6 per cent and 8 per cent a year through 2020 as the country tries to electrify more rural areas. Domestic production of coal for power will rise even faster, reducing imports, while a strong domestic steel-production outlook means the nation will have to increase metallurgical coal imports.
Gold demand should remain high in the country, which accounts for almost a quarter of global demand for the precious metal, as falling unemployment and steady inflation spur buying of jewellery, coins and gold bonds, Citi said. Iron ore exports will grow to 20 million tonnes a year from 6 million tonnes in 2016 as the government reduces and eliminates export duties and companies restart mines.
One commodity group that will not see as much impact from India’s expansion is meat, according to Citi. India is home to more vegetarians than any other country, with more than half its 1.25 billion people identifying as partially vegetarian or vegan, according to Citi.
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Date started: May 2018
Founder: Pir Arkam
Based: Dubai
Sector: Additive manufacturing (aka, 3D printing)
Staff: 18
Funding: Invested, supported and partnered by Joseph Group
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Director: Sean Baker
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Round 1: January 17-19, Yas Marina Circuit – Abu Dhabi
Round 2: January 22-23, Yas Marina Circuit – Abu Dhabi
Round 3: February 7-9, Dubai Autodrome – Dubai
Round 4: February 14-16, Yas Marina Circuit – Abu Dhabi
Round 5: February 25-27, Jeddah Corniche Circuit – Saudi Arabia
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UAE currency: the story behind the money in your pockets
THE SPECS
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Sectors: Internet, e-commerce
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Total funding: Self funded
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Based: Dubai, UAE
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UAE currency: the story behind the money in your pockets
UAE currency: the story behind the money in your pockets
How to avoid crypto fraud
- Use unique usernames and passwords while enabling multi-factor authentication.
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Australia tour of Pakistan
March 4-8: First Test, Rawalpindi
March 12-16: Second Test, Karachi
March 21-25: Third Test, Lahore
March 29: First ODI, Rawalpindi
March 31: Second ODI, Rawalpindi
April 2: Third ODI, Rawalpindi
April 5: T20I, Rawalpindi
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Stars: Ram Charan, Kiara Advani, Anjali, S J Suryah, Jayaram
Rating: 2/5
The specs
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Other workplace saving schemes
- The UAE government announced a retirement savings plan for private and free zone sector employees in 2023.
- Dubai’s savings retirement scheme for foreign employees working in the emirate’s government and public sector came into effect in 2022.
- National Bonds unveiled a Golden Pension Scheme in 2022 to help private-sector foreign employees with their financial planning.
- In April 2021, Hayah Insurance unveiled a workplace savings plan to help UAE employees save for their retirement.
- Lunate, an Abu Dhabi-based investment manager, has launched a fund that will allow UAE private companies to offer employees investment returns on end-of-service benefits.