Modi needs to begin his work in earnest



Now that the BJP has swept to power, Narendra Modi, the new prime minister of India, has no time to waste. Simply put, he needs to get on with fixing India’s many problems, particularly as the business of government has already been on hold for several months to allow for a long spell of campaigning and a marathon six-week voting cycle.

Having promised “good days” to the people of India, Mr Modi is well aware that he must deliver on his commitment. He must clearly articulate his vision for a new India – broad pronouncements, such as the ones he made in parliament earlier this week, of being a “government which thinks about the poor, listens to the poor and which exists for the poor” will not suffice for long – and he must quickly appoint his cabinet and the team that will deliver those policies.

If Mr Modi’s victory is an indication of a desperation for change, it has also put focus on the difficulty of governing a country like India, which is plagued by corruption, conflicting interests, overbearing bureaucracy and law and order issues. That explains why, despite numerous attempts at reform and change by previous governments, the country’s infrastructure, especially outside major cities, lies in tatters, while its economy has bottomed out over the past two years. That’s also why, despite exuding confidence and pronouncing he will run an efficient, decisive government able to swiftly implement policies, Mr Modi’s job will not be easy.

During his tenure as chief minister of Gujarat, the state achieved an average growth rate of 13.4 per cent, when the national rate stood at just above 7 per cent for the period. He attracted unprecedented investments, both domestic and foreign. Gujarat is considered an economic miracle for good reason. But what’s the benefit of a thriving economy if its fruits cannot be enjoyed by all citizens?

For that to happen, Mr Modi will have to find the voice of a statesman and represent all of India, and not just the winners.

Many in the country, particularly Muslims and Christians, are keen to hear him say that his prime concern is economic prosperity rather than Hindu nationalism. The sooner he sends that message, the better the prospects of him fulfilling his promises. That’s why he has no time to waste.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

Ziina users can donate to relief efforts in Beirut

Ziina users will be able to use the app to help relief efforts in Beirut, which has been left reeling after an August blast caused an estimated $15 billion in damage and left thousands homeless. Ziina has partnered with the United Nations High Commissioner for Refugees to raise money for the Lebanese capital, co-founder Faisal Toukan says. “As of October 1, the UNHCR has the first certified badge on Ziina and is automatically part of user's top friends' list during this campaign. Users can now donate any amount to the Beirut relief with two clicks. The money raised will go towards rebuilding houses for the families that were impacted by the explosion.”

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Various Artists 
Habibi Funk: An Eclectic Selection Of Music From The Arab World (Habibi Funk)
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Hydrogen: Market potential

Hydrogen has an estimated $11 trillion market potential, according to Bank of America Securities and is expected to generate $2.5tn in direct revenues and $11tn of indirect infrastructure by 2050 as its production increases six-fold.

"We believe we are reaching the point of harnessing the element that comprises 90 per cent of the universe, effectively and economically,” the bank said in a recent report.

Falling costs of renewable energy and electrolysers used in green hydrogen production is one of the main catalysts for the increasingly bullish sentiment over the element.

The cost of electrolysers used in green hydrogen production has halved over the last five years and will fall to 60 to 90 per cent by the end of the decade, acceding to Haim Israel, equity strategist at Merrill Lynch. A global focus on decarbonisation and sustainability is also a big driver in its development.

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iPad Pro

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Mac Mini

$799

Bharat

Director: Ali Abbas Zafar

Starring: Salman Khan, Katrina Kaif, Sunil Grover

Rating: 2.5 out of 5 stars

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