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Petro dollars now finding their way into India

Written by sanju singh

Sunday, 06 July 2008

06 July, 2008, Aman Dhall & Dheeraj Tiwari; economictimes.indiatimes.com: NEW DELHI: Petro dollars are now finding their way into India. Surprising it may sound but High Networth Individuals (HNIs) and financial institutions (read sovereign wealth funds) in the Middle-East are now routing their money to India through private equity firms. According to sources in the private equity space, Middle-East based investment houses such as Global Investment House (Kuwait), Abu Dhabi Investment Authority (ADIA) and Dubai Investment Group (UAE) are in talks with various India-focused private equity firms to invest in their funds. In fact, the investments from the Middle-East in the last six months has seen a whopping surge of more than 300%. Already Anil Dhirubhai Amabani Group (ADAG) holding, Reliance Communication, is in talks with global private equity and Middle East sovereign wealth funds, on sourcing capital for the proposed MTN deal. With the International Monetary Fund (IMF) expecting oil and gas exports to bring in $940 billion to the region this year, private equity players are expecting a windfall of petro dollars in the country. "The Middle East funds are growing very rapidly, thanks to the petro dollars. All these investment houses have deep pockets. The free fall of dollar has made these private equity firms in the Middle East diversify their risks and there is a greater propensity to invest outside the US, where traditionally they've been investing," a source told SundayET. Funds from Middle-East countries such as Oman, Abu Dhabi, Qatar and Dubai are currently on a lookout for Indian PE companies which have exposure in realty, infrastructure, healthcare, retail, and education sector. "It is not only the existing funds but personal funds, supported by HNIs in countries such as Brunei, the United Arab Emirates, Kuwait and Oman, which are looking to tap opportunities in India," the source said.