Omifco secures long-term India supply

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WHAT WE’RE TRACKING TODAY

THIS AFTERNOON: International banks join FX deposit race as INR nears another record low

Good afternoon, lovely people. The India-Oman corridor just unlocked another milestone: Newly listed Omifco will supply half of its urea production to India.

In today’s Spotlight, we look at why Indian AI startups are becoming the Gulf’s preferred build partners for sovereign AI and digital transformation. Indian companies are gaining customers across banking, healthcare, retail, and energy, turning the region into a strategic growth market for enterprise AI.

Plus: Reliance Industries delivered strong 1Q earnings by diversifying away from Gulf crude toward Russian barrels, while Emirates NBD-backed RBL Bank posted a 27% jump in its bottom line.

International banks vying for FX deposits

International banks are joining the queue to attract FX deposits from Gulf-based Indians, Bloomberg reports. HSBC and Standard Chartered have joined the rush for foreign currency non-resident deposits, with the Reserve Bank of India reopening a special window — for the first time in 13 years — that absorbs banks’ full hedging costs and lets clients borrow against their deposits. The attraction? The Indian arms of HSBC and StanChart are both offering depositors generous leverage, prompting Barclays and Citi to consider following suit.

The target is USD 60-80 bn — about 10% of India’s FX reserves — to shore up the INR after being drained by the US-Iran war. Banks pulled in some USD 26 bn through the same mechanism during the 2013 taper tantrum, and analysts expect collections to more than double this time.

ICYMI- India’s largest lender, State Bank of India, has already secured some USD 1.5 bn in FX deposits, while local banks have collectively raised USD 10 bn to date.

The glitch: It’s not exactly smooth sailing. The UAE’s central bank tightened rep-office rules for foreign banking, complicating onboarding and documentation for new UAE-based customers. Indian expats in the Gulf are expected to contribute 70% of the FX deposit inflow.

INR heading to another record low?

The INR tumbled to a two-month low of 96.4 / USD today, 0.2% down from Friday’s close, as surging oil prices and renewed US-Iran fighting weighed on macro parameters.

Oil pressure: The currency has depreciated 1.7% so far this month and is within a striking distance of its all-time low of INR 96.96 / USD. Brent rose 2.7% on Monday to cross USD 90 / bbl for the first time in nearly six weeks, adding to concerns over India’s inflation outlook, fiscal deficit, and import bill.

Central bank watch: Traders expect the INR to remain weaker than the 96 / USD level this week unless the Reserve Bank of India intervenes firmly — Brent above USD 95 / bbl could push the currency toward fresh record lows, a foreign-bank FX salesperson told the newswire.

Bond spillover: Higher crude is also driving Indian government bonds higher. The 10-year benchmark yield is quoted at 6.82% today, rising 4 bps.

US prosecutors defend decision to drop Adani criminal case

The US Justice Department (DoJ) has decided to drop criminal charges against Adani Group Chairman Gautam Adani, with Brooklyn federal prosecutors telling the court they have no basis to challenge the department’s decision, Reuters reports.

What’s gone down: The DoJ argued that the alleged misconduct was an India-based matter and that US prosecutors should not act as “world police.” The case, however, still requires the judge’s approval before it is formally dismissed.

IN CONTEXT- US prosecutors had accused Adani of participating in a USD 265 mn bribery scheme to secure a major solar power project in India, allegations denied by Adani Group.

Why it matters: Dropping the criminal case lifts a major judicial overhang for Adani Group, clearing up doubts over its access to international capital, project finance, and cross-border partnerships. For Gulf investors, these concerns appear to be fading. Earlier this month, Abu Dhabi’s International Holding Company pledged a fresh USD 5,7 bn investment, signaling that major institutional capital is again backing the conglomerate.

The big story abroad

International dailies are calmer than usual today, with the latest updates in the regional war leading the news cycle.

The US military launched another round of airstrikes against Iranian targets yesterday, marking its ninth consecutive night of strikes, the US Central Command said. The latest salvo follows the deaths of three US servicemembers this week in Jordan and Iraq.

Taiwan’s semiconductor giant TSMC is pouring another USD 100 bn into expanding its Arizona facilities, citing surging, multi-year demand for AI hardware. A major supplier of chipmaker Nvidia, TSMC reported record 2Q results last week and has not ruled out the possibility of issuing new bonds should market conditions prove favorable, its CFO Wendell Huang said.

Spain brought home its second-ever World Cup trophy after triumphing 1-0 over Argentina. The New Jersey showdown proved a stalemate until substitute Ferran Torres secured the winning goal in extra time.

Meanwhile at the box office, Christopher Nolan’s The Odyssey brought in USD 264 mn globally in its opening weekend — the director’s highest-grossing debut so far. The film — the first ever to be shot entirely on Imax cameras — flaunts an all-star cast and garnered widespread critical acclaim.

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India to receive 1 mpta of urea from Omifco till 2031

Omifco secures major supply agreement with India: Oman India Fertiliser Company (Omifco) will supply c. 1 mpta of urea to the Indian government under a back-to-back agreement, according to a filing (pdf). Beginning August, OQ Trading will purchase c. 2 mpta from Omifco, half of which will be earmarked for Indian buyers through February 2031.

How it works: The agreement forms part of Omifco’s revised urea offtake framework with OQ Trading. Under the agreement, OQ Trading will purchase Omifco’s export volumes — excluding domestic sales in Oman — and supply them to the Indian government. Omifco’s sales to OQ Trading will remain linked to select Middle East FOB netback indices, while India-bound volumes will be priced against India-specific benchmarks.

The supply agreement comes weeks after Omifco raised USD 678 mn from its IPO, valuing the company at about USD 2.6 bn. Before the listing, Oman Oil Company held 50% of Omifco, while Indian Farmers Fertiliser Cooperative and Krishak Bharati Cooperative held 25% each.

Why it matters: The agreement locks in a long-term offtake channel for India while giving newly listed Omifco greater longer-term visibility over its export volumes. It also reinforces the strategic role the India-Oman fertilizer partnership continues to play in India’s food security and fertilizer import strategy.

As the Gulf pours USD bns into AI, Indian startups are becoming its go-to build partners

The UAE and Saudi Arabia have spent the past two years pouring USD bns into AI infrastructure, sovereign AI, and digital transformation. Indian AI startups are increasingly emerging as key partners in that push, gaining enterprise customers across sectors from banking and healthcare to retail and energy.

The Gulf has become a strategic growth market for Indian AI companies as the region is one of the world’s fastest-growing buyers of enterprise AI.

“The US continues to be one of the largest markets for Indian startups. What we are seeing is that the Gulf, particularly the UAE, has emerged as a strategic growth market over the last few years,” Shivendra Singh, vice president and head of global trade development at Nasscom, tells EnterpriseAM.

Strong enterprise demand, progressive AI policies, regulatory sandboxes, and the UAE’s role as a gateway to the wider MENA region make the Gulf an increasingly attractive market for Indian AI startups, Singh says.

“Governments in markets such as the UAE and Saudi Arabia are also major buyers and early adopters of AI,” Vijay Gopalakrishnan, partner at Deloitte India, tells us. Combined with sovereign AI funding, business-friendly regulation, and strengthening India-GCC trade ties, these factors have created prospects particularly in financial services, retail, energy, and government services.

India’s AI ecosystem comes of age

India now has more than 3.1k AI startups and ranks third globally in AI capability, up from seventh last year, according to a report (pdf) by Zinnov, Indiaspora, and Activate. A growing number of mid-stage companies have already proven their technology and are now looking to scale internationally, creating a pipeline of firms ready to tap overseas demand.

The trend is already visible on the ground. Companies including Fractal, Yellow.ai, Uniphore, Kore.ai, Gnani.ai, Observe.AI, Whatfix, and MathCo have established customers or operations across the GCC, while Abu Dhabi’s Hub71 has emerged as a preferred landing pad for Indian AI startups.

Beyond capital

“The first reason why Indian AI startups are eyeing Gulf expansion is the availability of high-quality, systematic data,” Shravan Bhati, co-founder and CEO of SatLeo Labs, tells EnterpriseAM. “The second reason is the region’s willingness to adopt new technologies.” That combination allows startups to build better AI models while finding customers willing to deploy new solutions faster than in many mature markets. “This is why many Indian AI companies choose the Middle East as their first international market,” he says.

All in on AI: Concurring that the GCC has emerged as one of the world’s most forward-looking regions when it comes to AI adoption, Dhruv Bhatia, head of international business at healthcare AI startup 4baseCare, tells us that Gulf governments have made AI a national priority, and there is a genuine willingness to adopt technologies that improve patient outcomes.

Healthcare providers have continued investing in AI despite geopolitical uncertainty because technologies that improve clinical outcomes remain a priority. “For bBaseCare, the decision (to expand to the Gulf) was driven by a clear healthcare need rather than market expansion alone. We saw [a window] to combine our genomics expertise, AI-driven clinical decision support, and laboratory capabilities to address that gap,” he says.

“The combination of bottom-up enterprise demand and top-down government mandate is what’s pulling Indian AI companies into the region right now,” Ahshad Jussawala, CEO of Reliance-affiliated AI company Jio Haptik tells EnterpriseAM.

For Haptik, the pivot to the Gulf was inbound; when UAE and Saudi enterprises asked Haptik to solve problems they already solved for India’s consumer-scale market, Jussawala adds.

Challenges remain

Although the GCC region has significant financial resources, buyers can still be price-sensitive, cautions Gopalakrishnan.

“Clients in the region are also highly demanding, and Indian AI startups must be prepared to manage these expectations. Besides, the need to provide AI solutions that address local Arabic-language requirements, along with geopolitical uncertainty and associated security concerns, are key challenges for Indian startups,” he says.

The next Gulf corridor?

The India-GCC AI corridor is likely to continue booming over the next three to five years, experts say, with Gulf establishments increasingly looking at Indian AI startups for their strong engineering capabilities, speed of execution, and the ability to build scalable AI solutions.

“For many Gulf enterprises, Indian startups are innovation partners who understand emerging markets and can support long-term digital transformation. While cost competitiveness remains an advantage, the bigger differentiator today is the ability to co-innovate and deliver AI solutions at scale,” Singh says.

Reliance Industries shrugs off oil market turmoil with strong 1Q earnings

Refining resilience: Reliance Industries (RIL), India’s largest conglomerate by market cap, kicked off FY 2027 with a stronger-than-expected 1Q, reporting a consolidated net income of INR 209.4 bn (USD 2.4 bn), down 22.4% y-o-y, as per the company’s financial statement (pdf), beating Bloomberg consensus estimates of INR 198.2 bn (USD 2.3 bn). Reliance is one of India’s largest importers of MENA crude.

Revenue from operations crossed the INR 3 tn mark for the first time, rising 25.4% y-o-y to INR 3.1 tn (USD 35.9 bn). The bottom-line decline from a year earlier was largely due to a one-off gain from the sale of its Asian Paints stake in the base quarter. Excluding that, underlying earnings remained resilient.

Why it matters: Reliance reduced its crude oil purchases from the Gulf during the quarter, relying heavily on Russian barrels amid the Iran war and the Strait of Hormuz disruptions, the company’s investor presentation (pdf) shows. For Reliance, the diversification appears to have paid off. While the Iran conflict rattled global oil markets, the company’s refining operations remained largely insulated — helping deliver one of the strongest earnings of the season.

Reliance’s oil-to-chemicals (O2C) business held up despite crude market volatility following the Iran war and disruptions in the energy markets. O2C revenue jumped 30.4% y-o-y to INR 2 tn (USD 23.2 bn) as strong middle-distillate cracks, better petrochemical spreads, and operational flexibility helped offset concerns that higher freight, ins., and crude premiums would weigh on margins. The segment accounted for nearly two-thirds of group revenue during the quarter, underscoring that Reliance’s traditional energy businesses continue to bankroll its newer growth engines.

Jio Platforms, the digital arm of the conglomerate, posted revenue of INR 391.7 bn (USD 4.5 bn), up 11.8% y-o-y, while net income rose 9.2% to INR 77.6 bn (USD 894 mn), delivering a strong quarter ahead of its IPO. The performance will be closely watched in the Gulf, where sovereign investors including the Abu Dhabi Investment Authority, Mubadala, and Saudi Arabia’s Public Investment Fund remain among Jio’s high-profile backers.

RBL delivers strong earnings debut after Emirates NBD takeover

Indian lender RBL Bank reported a 27% y-o-y increase in 1Q net income to INR 2.5 bn (USD 26.3 mn), according to an earnings release. Net revenue gained 6.4% y-o-y to 47.9 bn (USD 498.5 mn). This is RBL’s first complete earnings since Dubai’s Emirates NBD completed the acquisition of a controlling 60% stake in the bank.

By the numbers: Net advances grew 23% y-o-y, led by a 38% jump in wholesale lending, including corporate loans — likely to be a key focus area as Emirates NBD looks to capitalize on growing India-GCC trade and investment flows.

Integration begins: RBL proposed appointing senior Emirates NBD executives, including Shayne Keith Nelson and Patrick John Sullivan, to its board as the new owner begins integrating the bank. It also approved plans to raise up to INR 100 bn (USD 1 bn) through debt and increase its borrowing limit to INR 400 bn. The bank has already retired INR 105 bn (USD 1.09 bn) of high-cost borrowings and raised USD 150 mn through foreign currency non-resident deposits, with plans to tap Emirates NBD’s customer network to expand cross-border deposits and trade finance.

Why it matters: The results offer an early look at the business Emirates NBD has acquired. Robust corporate loan growth reinforces the strategic rationale for the acquisitions, giving the UAE lender greater exposure to India’s expanding corporate credit market.

Bajel Projects opens Abu Dhabi unit for Gulf contracts

Mumbai-based firm Bajel Projects has incorporated a wholly owned subsidiary in Abu Dhabi as it accelerates power transmission and distribution projects across Gulf markets, as per an exchange filing. The subsidiary will enable the company to bid directly for engineering, procurement, and construction (EPC) contracts covering transmission lines, substations, and distribution networks across the Middle East.

Why it matters: Setting up dedicated operations in the GCC allows Indian contractors to bypass middleman fees and capture the structurally higher margins offered by Gulf state-owned entities. The UAE subsidiary gives Bajel a local operating platform in one of the GCC's fastest-growing power infrastructure markets, where governments are heavily investing in projects.

Skyroot touching skies

Skyroot enters orbit: Skyroot Aerospace’s Vikram-I completed its maiden orbital mission after lifting off from the Indian Space Research Organisation’s (Isro) spaceport on Saturday, the company said on X. The mission made Skyroot the first private Indian company to launch a rocket into orbit from Indian soil, according to a press release.

The launch moves India’s private space sector from suborbital testing to orbital delivery, four years after Skyroot launched. Founded in 2018, Skyroot was reportedly valued at USD 1 bn earlier this year.

MENA economy to shrink in 2026 before 6.5% rebound -BMI

BMI has pushed MENA recovery into 2027, projecting the region’s economy will contract in 2026 before rebounding next year. The Fitch Solutions research house said in a webinar attended by EnterpriseAM that it now sees regional GDP contracting 0.7% this year, then rebounding 6.5% in 2027, with almost all of that recovery resting on oil exports, which in turn depend on the reopening of the Strait of Hormuz.

The downgrade tracks a stickier Hormuz and a shift into what BMI calls “messy negotiations.” Washington has reimposed its naval blockade on Iranian ports, and Tehran has moved to shut the strait, through which roughly a fifth of the world’s seaborne oil and LNG normally passes. BMI has put its full-year oil forecast under review and lifted its working range for Brent to USD 80-95 a barrel in 2H 2026, up from the USD 70-80 it had penciled in under its “constructive” scenario. A sustained break above USD 90 would start to embed supply-shortage fears, BMI analysts said.

Even a diplomatic breakthrough buys months, not weeks. BMI expects a one-month test period, followed by at least six to 12 weeks of sustained calm, before tanker traffic returns to levels shippers consider commercially normal. Meanwhile, broader cargo vessels are expected to lag further behind.

What to watch: Oil market sentiment above all and the shape of any Hormuz charge. BMI expects Iran to push for fees on vessels using the strait but rates the chance of a permanent transit toll being widely accepted as low. More plausible is a services-fee structure tied to navigation, traffic management, and environmental protection — the Malacca Strait model — with Oman steering the GCC that way. One wrinkle they flagged is a US security-services fee on ships it escorts could end up normalizing Iran’s own demand for a fee.

The breakdown

The divide comes down to one thing: whether a country can get its exports out through an alternative to Hormuz, with the biggest pain concentrated in economies most dependent on the waterway.

In the contraction zone: Iraq’s economy is expected to shrink 8.5% as collapsing oil exports open a USD 30 bn fiscal gap, Qatar is expected to contract 7.2% as LNG exports remain stranded, and Kuwait is projected to fall by 8.1% as both oil and non-oil activity weaken. Bahrain is in the most vulnerable position, with BMI forecasting the deficit to widen to 8.5% of GDP and debt to exceed 150% as sectors accounting for about 85% of output come under pressure.

Countries with alternative export routes are projected to fare better. Saudi Arabia’s GDP is expected to grow around 1% in 2026 before accelerating to 6.8% in 2027, supported by its Red Sea export corridor and public investment — though disruption to that route from Yemen remains a key risk. Oman is expected to lead the GCC with 3.1% growth thanks to exports through Mina Al Fahl, which bypasses Hormuz, before moderating to 1.7% next year. Further afield, Egypt’s growth is tipped to hover near 5% as portfolio inflows recover, while Morocco is projected to stay above 4% on stronger agriculture and auto exports.

The UAE falls somewhere in between. While it has rerouted some crude exports through Fujairah, weakness in the non-oil economy is projected to leave growth broadly flat this year, which would mark its weakest performance since the pandemic. However, growth is expected to rebound by 11% in 2027 as oil output and trade recover. Like most of BMI’s 2027 forecasts, this recovery assumes Hormuz reopens, since a prolonged disruption would require another revision.

MARKETS THIS MORNING-

Asia-Pacific markets fell sharply in early trading this morning as escalating regional tensions pushed Brent crude prices up and cautious investors sat tight awaiting the upcoming wave of tech earnings. South Korea’s Kospi dropped 3.1%. Wall Street is set to open the first trading day of the week in the red, with major US index futures trading down.

Sensex	77,726	-0.5% (YTD: -8.7%)
NIFTY 50	24,240	-0.3% (YTD: -7.2%)
ADX	9,716	-0.6% (YTD: -2.7%)
DFM	5,768	-0.7% (YTD: -4.5%)
Tadawul	10,732	+0.1% (YTD: +2.3%)
EGX30	53,117	+1% (YTD: +26.9%)
Boursa Kuwait	8,747	-0.1% (YTD: +5.3%)
QSE	10,006	+0.5% (YTD: -7%)
S&P 500	7,457	-1% (YTD: +8.9%)
FTSE 100	10,560	-0.3% (YTD: +6.3%)
Euro Stoxx 50	6,240	+0.1% (YTD: +7.7%)
Brent crude	USD 88	-0.1%
Natural gas (Nymex)	USD 2.8	-2.2%
Gold	USD 4,023	+0.1%
BTC	USD 64,174	-0.4%

The values in the table above are listed according to the market position as of 3:30pm IST / 2pm GST.

CALENDAR

JULY

22-24 July (Wednesday-Friday): Rail & Metro Technology Conclave 2026, Bharat Mandapam, New Delhi.

30-31 July (Thursday-Friday): Global Industrial Relations Summit, FICCI, Federation House, New Delhi.

AUGUST

6-8 August (Thursday-Saturday): Assocham Aquabiz - Conference & Exhibition on Aquaculture, Fisheries & Marine Economy, Vijayawada, Andhra Pradesh.

12-13 August (Wednesday-Thursday): FICCI Global Skills Summit 2026, Federation House, New Delhi.

12-15 August (Wednesday-Saturday): Indian Business Expo, Pragati Maidan, New Delhi.

15 August (Saturday): Independence Day.

26 August (Wednesday): Prophet Mohammad’s Birthday.

SEPTEMBER

1-3 September (Tuesday-Thursday): India Energy Week, Dwarka, New Delhi.

7-9 September (Monday-Wednesday): BSX Bengaluru Space Expo, Bangalore International Exhibition Centre, Bengaluru.

7-9 September (Monday-Wednesday): Sanjeevani 2026, Pragati Maidan, New Delhi.

7-9 September (Monday-Wednesday): iPHEX 2026 International Pharma Exhibition, Bharat Mandapam, New Delhi.

8-11 September (Tuesday-Friday): Global Fintech Fest, Mumbai.

17-19 September (Thursday-Saturday) : Semicon India Conference, Yashobhoomi, Delhi.

27-30 September (Sunday-Wednesday): World Congress on Nanomedicine, 2026, Vigyan Bhawan, New Delhi.

OCTOBER

1-3 October (Thursday-Saturday): Horticonnect India Expo 2026, Bangalore International Exhibition Centre, Bengaluru.

2 October (Friday): Gandhi Jayanti (Mahatma Gandhi’s Birthday).

2-4 October (Friday-Sunday): GJS India Gem & Jewellery Show 2026, Jio World Convention Centre, Mumbai.

2-5 October (Friday-Monday): Bharat Biofuel & Energy Expo 2026, Labhganga Exhibition Center, Indore.

7 October (Wednesday): CyberSec Delhi 2026, Radisson Blu, Dwarka, New Delhi.

7-10 October (Wednesday-Saturday): India Mobile Congress 2026, Yashobhoomi, Dwarka, New Delhi.

13-17 October (Tuesday-Saturday): IHGF Delhi Fair (Autumn) 2026, India Expo Centre & Mart, Greater Noida.

20 October (Tuesday): Dussehra.

23-25 October (Friday-Sunday): Bharat International Rice Conference 2026, Pragati Maidan, New Delhi.

NOVEMBER

14-27 November (Saturday-Friday): India International Trade Fair 2026, Bharat Mandapam, New Delhi.

16-18 November (Monday-Wednesday): Industrial Connect Expo 2026, India Expo Centre & Mart, Greater Noida.

16-18 November (Monday-Wednesday): Gartner IT Symposium/Xpo 2026, Grand Hyatt Kochi Bolgatty, Kochi.

17-19 November (Tuesday-Thursday): Bengaluru Tech Summit 2026, Bengaluru Palace, Bengaluru.

18-21 November (Wednesday-Saturday) International Mining and Machinery Exhibition 2026, Science City Ground, Kolkata.

20-22 November (Friday-Sunday): India Art Festival 2026, Constitution Club of India, New Delhi.

24 November (Tuesday): Guru Nanak Jayanti.

27-30 November (Friday-Monday): INTEXT Expo 2026, Ludhiana Exhibition Centre, Ludhiana.

DECEMBER

8-11 December (Tuesday-Thursday), Expand North Star, Dubai.

25 December (Friday): Christmas Day.

Signposted to happen sometime in 2H 2026:

Monsoon Session of Parliament is expected to be held in July/August in New Delhi (TBA);
Reserve Bank of India’s Monetary Policy Committee meeting for the September cycle (TBA);

JANUARY 2027

30 January-3 February (Saturday-Wednesday): Printpack India, India Expo Centre, Greater Noida (Delhi NCR).

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