Dubai clearly wants to be the Singapore of the Arab world—a free port and global financial services hub. It seems that India will occupy an important part in the plans of these two city states.
Last week, Dubai’s official investment company bought a 2.87% stake in ICICI Bank Ltd. Two investment vehicles of the Singapore government already hold a large stake in India’s largest private sector bank. Both Singapore and Dubai are chasing Indian companies to list on their stock exchanges. The two cities are also centres for the offshore rupee non-deliverable forward (NDF) market.
This week, the Dubai government has merged two of its large banks to create Emirates NBD, which will be one of the region’s biggest banks. The new entity is expected to brush up its India plans. Meanwhile, banks from Singapore are trying to expand in India. It will be interesting to watch the two cities battle it out for a share of the Indian cake.