The construction boom in the United Arab Emirates (UAE) has seen a growing number of Indian investors setting up base in that country, particularly in the free zones, a top Sharjah official said here.
"During the last five years, investment in real estate development in the UAE has gone up considerably, leading to high demand for building materials and other equipment," said Sheikh Saqr Al Qassemi, the Deputy Director General of Sharjah Airport International Free Zone (SAIF-Zone).
"During the last five years about Dirhams 60 billion ($16.3 billion) worth of investment in real estate development in the UAE has seen a considerable demand for construction material. This has attracted a lot of investors, particularly from India," Al Qassemi, on a fortnight-long roadshow to India, told.
The official said that this year alone five or six major projects worth Dirhams 100 billion ($27 billion) had been launched. These include two residential and infrastructure projects in Sharjah.
"One of the major projects in Sharjah is a seafront residential complex with an investment of Dirhams 25 billion. Another is an industrial complex involving Dirhams 700-800 million," he said.
Al Qassemi said this time Chandigarh, New Delhi, Hyderabad and Indore have been selected mainly with an eye on attracting small and medium size companies seeking to expand operations overseas.
During the last few visits to India, the SAIF-Zone team has been showcasing its facilities in smaller metros and industrial cities like Ludhiana, Bhubaneswar, Jaipur and Kochi to seek wider Indian participation.
Currently, Indians account for 48 percent of the over 2,020 companies in SAIF-Zone. Most Indian companies are catering to the needs of the construction sector not only in the UAE but also in the Middle East and Africa.
The latest to set up base there is the logistics centre by Bajaj International while Mahindra Intertrade of Mahindra Group has put in place a steel service centre.
Zee Telefilms, ICICI Infotech, Living Media, Godrej and Ashok Leyland are among other major Indian companies with a base in SAIF- Zone, which is adjacent to the Sharjah Airport.
Most companies in SAIF-Zone are exporting about 90 percent of their products with 10 percent being targeted at the local market.
Happy with the response from prospective investors during the roadshow in Chandigarh and New Delhi, Al Qassemi and his team hope more IT and food processing companies will locate themselves in the SAIF-Zone to take advantage of the varied facilities provided there.
Promising cost advantage, particularly in terms of cheaper and reliable power availability, Al Qassemi said the Sharjah authorities are mulling the supply of gas to industries once the city gas distribution project has been completed.
"We are looking at the options of offering industrial gas which would be more economical and cost advantageous. But it will take time," he said.
According to SAIF-Zone officials, while India is being looked at as an evergreen market, Pakistan and Egypt are the two other countries being wooed for investments.
With India and the Gulf Cooperation Council (GCC) negotiating for a free trade agreement, Al Qassemi expressed the hope that bilateral trade and investment flow would get a major boost.