Indian defence minister Manohar Parrikar speaking at the air force base in Pathankot on January 5, 2016. Mr Parrikar will be in the UAE for a two-day visit on May 17, 2016 as the two countries seek to forge closer security and trade ties. Narinder Nanu/AFP Photo
Indian defence minister Manohar Parrikar speaking at the air force base in Pathankot on January 5, 2016. Mr Parrikar will be in the UAE for a two-day visit on May 17, 2016 as the two countries seek toShow more

UAE and India set to forge closer trade and military ties



NEW DELHI // India’s defence minister, Manohar Parrikar, will arrive in the UAE on Wednesday for a two-day visit, aiming to bolster security ties and explore the potential of trade in military equipment.

Mr Parrikar’s trip marks the first-ever bilateral visit by an Indian defence minister to the UAE. It is a sign, analysts say, of how the relationship between the two countries has strengthened since prime minister Narendra Modi took power two years ago.

The UAE extended a formal invitation to Mr Parrikar when Sheikh Mohammed bin Zayed, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the Armed Forces, visited India in February.

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Both countries are looking to expand cooperation in defence and security affairs beyond counter-terrorism operations, said Sushant K Singh, a New Delhi-based defence analyst and a retired Indian Army lieutenant colonel.

Among the top priorities on Mr Parrikar’s agenda is to ensure the militaries of India and the UAE work well together.

“This is driven by the recent Indian experience of retrieving expat Indians from the Middle East, where the Indian military had to move in,” Mr Singh said. “It is better for the military systems in these countries to be familiar with the Indians, so that such humanitarian and disaster relief operations, if they’re required in the future, can run smoothly.”

As an example, he cited the operation last April, called Raahat, in which India evacuated more than 4,600 of its citizens from Yemen by air as well as sea, as war raged between Houthi militants and government forces supported by UAE troops.

Mr Parrikar will tour industrial and military installations in the UAE during his visit. With his counterparts, he will discuss military logistics and cooperation in hydrographic studies, a spokesperson for India’s defence ministry said. Mr Parrikar will also hold talks on whether the UAE can be a potential customer for Indian-made defence equipment, and what equipment the UAE’s military needs.

These talks, however, will be in the earliest stages. Mr Singh called this a preliminary, exploratory step.

“It’s too early to identify any equipment that might be bought or sold, at this point,” he said. India will also need to scale up its defence production capacities before it can consider selling significant volumes of equipment to the UAE.

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Mr Modi’s enthusiasm for closer relations with the UAE markedly improved the quality of ties, Mr Singh noted.

The earlier government, the Congress-led United Progressive Alliance (UPA), also pursued a good working relationship with the UAE, exemplified by the UAE’s deportation of “a couple of wanted terrorists to India during that period”.

But Mr Modi’s energies in this direction have been even greater.

“The attempt is to delink India from being seen from the prism of Pakistan,” he said. “Notwithstanding the UAE’s relationship with Pakistan, it must engage India independently and on its own terms.”

As part of Mr Parrikar's trip, three Indian warships – INS Delhi, INS Tarkash and INS Deepak – have already anchored at Dubai. These ships will conduct joint exercises with the UAE's navy over the next three days.

Following his visit to the UAE, Mr Parrikar will go to Oman for three days before returning to New Delhi.

ssubramanian@thenational.ae

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Install an air filter in your home.

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Milestones on the road to union

1970

October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar. 

December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.

1971

March 1:  Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.

July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.

July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.

August 6:  The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.

August 15: Bahrain becomes independent.

September 3: Qatar becomes independent.

November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.

November 29:  At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.

November 30: Despite  a power sharing agreement, Tehran takes full control of Abu Musa. 

November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties

December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.

December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.

December 9: UAE joins the United Nations.

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Thursday’s fixtures

6pm: Hyderabad Nawabs v Pakhtoon Warriors

10pm: Lahore Sikandars v Pakhtoon Blasters

Teams

Chennai Knights, Lahore Sikandars, Pakhtoon Blasters, Abu Dhabi Stars, Abu Dhabi Dragons, Pakhtoon Warriors and Hyderabad Nawabs.

Squad rules

All teams consist of 15-player squads that include those contracted in the diamond (3), platinum (2) and gold (2) categories, plus eight free to sign team members.

Tournament rules

The matches are of 25 over-a-side with an 8-over power play in which only two fielders allowed outside the 30-yard circle. Teams play in a single round robin league followed by the semi-finals and final. The league toppers will feature in the semi-final eliminator.

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- Marie Curie

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- Leonardo Di Vinci

- David Bowie

- Paul McCartney

- Albert Einstein

- Jack the Ripper

- Barack Obama

- Helen Keller

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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.”

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