(Commonwealth_ India) The Abu Dhabi Investment Authority (ADIA), the largest sovereign wealth fund in the United Arab Emirates (UAE) and one of the largest globally, has officially commenced its operations in India. This significant move is anticipated to invigorate investment activity in the region, enhancing India’s position as a key destination for global capital.
Founded in 1976, ADIA manages a diverse portfolio of investments on behalf of the government of Abu Dhabi. With assets under management exceeding $700 billion, ADIA’s investment strategy spans multiple asset classes, including public equities, fixed income, real estate, private equity, and infrastructure. This diversified approach enables ADIA to adapt to changing market conditions while seeking attractive returns over the long term.
The establishment of ADIA’s operations at the Gujarat International Finance Tec-City (GIFT City) marks a pivotal step in its investment journey in India. The announcement was made during a meeting of the India-UAE High-Level Joint Task Force on Investments held in Mumbai, co-chaired by Indian Commerce Minister Piyush Goyal and Sheikh Hamed bin Zayed Al-Nahyan, ADIA’s managing director.
GIFT City is being promoted by the Indian government as a premier financial hub, designed to attract global capital and enhance the country’s financial services sector. The city offers a unique regulatory environment, providing companies with a complete tax exemption on business profits for any 10 consecutive years within 15 years. Additionally, there are no taxes on the transfer of funds from overseas, making it an attractive proposition for foreign investors.
The existence of ADIA in GIFT City underlines the strong awareness of UAE institutional investors in India’s active economy. Sheikh Hamed expressed confidence in India’s long-term growth prospects, stating, that India is one of the world’s fastest-growing economies and has been a key focus for ADIA’s investment activities for several years. We have built an extensive portfolio that spans asset classes, and we remain confident in India’s long-term growth prospects. The establishment of ADIA’s subsidiary in GIFT City is a testament to India’s robust investment environment and highlights the UAE’s strategic role as a leading investor in the region. According to Indian government data, the UAE has consistently been the largest Middle Eastern investor in India, with investments amounting to approximately $3 billion in the financial year 2023-24.
As ADIA sets up operations in GIFT City, it is poised to drive further investment inflows into India, particularly in infrastructure, renewable energy, technology, and financial services. This development aligns with India’s broader economic goals, including infrastructure development and financial inclusion, and enhances GIFT City’s reputation as a world-class financial services center operating under a robust regulatory and legal framework.
The announcement of ADIA’s operations in India also follows Prime Minister Narendra Modi‘s state visit to Abu Dhabi in July 2023, where discussions around deepening economic ties between the two nations were a focal point. This strategic partnership is expected to create numerous opportunities for collaboration and investment, benefiting both economies in the long run. The operational launch of the Abu Dhabi Investment Authority in India is not just a milestone for ADIA but also a significant endorsement of India’s potential as a thriving investment landscape, promising mutual growth and economic prosperity for both nations.
