Dubai: Dubai Islamic Bank PJSC, the United Arab Emirates’ biggest Shariah-compliant lender, is exploring an entry into India as it seeks to benefit from the funding needs of one of the world’s fastest-growing economies, Bloomberg Business reported.
“We as part of our international growth strategy are looking into India as one of the emerging Islamic finance markets," Chief Executive Officer Adnan Chilwan said in an e-mailed response to questions from Bloomberg News.
India presents huge opportunities as an emerging economy because of infrastructure development and growing trade with the Middle East, he said.
Indians make up nearly a quarter of the U.A.E.’s population, and India is its biggest trading partner, with combined exports and imports of $63.7 billion in 2014, according to data compiled by Bloomberg.
The two countries plan to create a $75 billion fund to invest in Indian infrastructure, according to a joint statement at the end of Prime Minister Narendra Modi’s visit to the U.A.E. in August.
Dubai Islamic Bank is seeking opportunities abroad as its home market, with about 10 million people, offers limited growth potential.
Last week it won approval to boost its stake in Indonesia’s Bank Panin Syariah Tbk PT to 40 percent, and it’s set to begin operations in Kenya within a few months, Chilwan said.
The Indian government needs capital to complete ambitious projects including the modernizing of railways, the construction of about 100 smart cities and establishing dedicated freight corridors, Chilwan said.
India faces a funding gap of $300 billion in meeting its infrastructure needs until 2017 and its public sector banks, which have been the main source of funding, are over-leveraged, he said.