As UAE deepens ties, Indian securities get first ETF in Gulf: Report

Investors in the United Arab Emirates (UAE) are set to get their first regional exchange traded fund (ETF) tracking Indian equities, . Lunate Capital LLC is launching the Chimera S&P India Shariah ETF, replicating the performance of the S&P India Shariah Liquid 35/20 Capped Index. The fund will track the performance of Shariah compliant Indian equities listed on the .

Indian stocks as India continues to be one of the most favoured emerging markets. The gains were supported by the fastest growth among the world’s major economies and persistent investor concerns over the outlook for India’s biggest emerging market rival, China. Moreover, Indian equities are poised to rise further in 2024, an informal survey conducted by .

The S&P India Shariah Liquid 35/20 Capped Index rose 16 per cent last year, although it couldn’t keep pace with the Nifty50 Index 20 per cent gain. The new ETF is set to include large cap Indian stocks such as Reliance Industries, Infosys, and TCS, and is open for investor subscription from Jan 12 to Jan 17.

There were an estimated 3.5 million Indian expatriates in the UAE as of 2021, comprising about 30 per cent of the Gulf country’s population. UAE is considering investing as much as $50 billion in India, its second largest trading partner, reported. As part of the push, entities overseen by Sheikh Tahnoon bin Zayed Al Nahyan, a member of Abu Dhabi’s ruling family, have held early stage talks on investing billions of dollars in India.

Along with other portions of Sheikh Tahnoon’s sprawling empire, Lunate and Chimera Investments will be folded into a new firm called 2PointZero. That firm will be transferred to Abu Dhabi’s $244 billion International Holding Co, which is also chaired by Sheikh Tahnoon — one of Abu Dhabi’s two deputy rulers, the UAE’s national security adviser and brother to its president.

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