Good morning, folks, and welcome back after what we hope was a relaxing long weekend. It’s a reflective look back this morning as we take stock of how the markets fared this year, and the implications on our corridor. How will the events of 2025 shape trade this upcoming year? We answer that question in the news well below.

Watch this space

AUTOMOTIVE — Beijing has begun issuing a “trickle” of export licenses for rare earth magnets to major Indian automakers and their global suppliers after an eight-month standoff had constrained supplies to India’s EV sector, Business Standard reported last week. Approvals have recently been cleared for vendors of Mahindra, Maruti Suzuki, Honda, and the Indian units of Continental AG and Hitachi Astemo.

Why it matters: China accounts for 90% of global rare-earth magnet production, but has been throttling Indian EV manufacturers and preventing them from building strategic stockpiles by processing only a handful of licenses at a time.

Consequences: The shortage of rare earth magnets forced auto major Maruti Suzuki to cut near-term production targets by up to two-thirds in June. Sustained trade curbs by China would weigh on returns for these investors and could disrupt the supply of affordable EVs for the Gulf market.

Corridor angle: Over the past three years, Gulf investors including the Abu Dhabi Investment Authority, META4, and Saudi Arabia’s Abdul Latif Jameel Group have invested USD mns into Indian EV players to secure a China+1 supply chain for their own energy transitions. Indian EV manufacturers such as JBM Electric Vehicles and Ashoka Leyland are also tapping into the Gulf markets.

OIL — Reliance Industries has reportedly resumed purchases of discounted Russian crude from non-sanctioned suppliers, Bloomberg reported last week, citing people with knowledge of the matter. After pausing imports following the 22 October US sanctions on Rosneft and Lukoil, Reliance is now sourcing barrels from non-sanctioned entities like RusExport.

The firewall: Reliance is routing these flows via Aframax tankers specifically to its plant in Jamnagar which has been split in two. The section housing Russian crude supplies India’s domestic market, while Jamnagar’s export-oriented unit has not taken a Russian shipment since November 20 — likely to avoid secondary sanction risks in Western markets.

There are consequences for the GCC: Reliance increased its monthly imports from Saudi Arabia by 87% and from Iraq by 31% last October as pressure from sanctions intensified, but the latest move could ensure that nearly half of its total capacity remains closed to GCC producers as long as Russian supply stays in place.

Expert view: Last week, we spoke to India’s leading energy expert Narendra Taneja, who told us in an exclusive interview that the Indian government has issued no directive in favor of or against buying Russian crude, highlighting that Indian refiners will continue supplies as long as commercially feasible.

Data point

USD 11 bn — that’s the threshold engineering exports from India exceeded in November, marking a 23.7% y-o-y increase and the strongest monthly total this fiscal year, Hindu Businessline reports, citing data from the Engineering Export Promotion Council of India.

The view from the Gulf: While overall exports improved, shipments to the UAE and Saudi Arabia declined y-o-y in November.

The drivers: The rebound was led by a 39% y-o-y increase in shipments to the EU (at a total value of USD 2.02 bn) and an 11.4% rise in exports to the US despite tariff-related headwinds. Out of 34 engineering product categories, 32 recorded growth, led by motor vehicles, industrial machinery, and electrical equipment.

The big story abroad

With a holiday-shortened business week yet to begin in the west, the global business press is once again going long on geopolitics, offering deep dives into inconclusive talks yesterday between US President Donald Trump and Ukraine’s Volodymyr Zelenskyy. Trump called the talks to end the war in Ukraine “excellent” and said they had made “a lot of progress.” Zelenskyy was less enthusiastic.

We’ll see as the day wears on whether the Santa rally in equities continues… Asian markets opened mixed this morning.

…but commodities are doing well: Silver rallied to a record high north of USD 80 per ounce, gold edged higher, and Brent crude poked above USD 61. You can thank geopolitical tensions, a weaker USD, and Beijing making all the right noises about supporting domestic growth in 2026.

With news sparse, there’s lots of stocktaking about 2025 — and looking ahead to 2026 and beyond — if you’re in the mood:

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