Good afternoon, folks. We are bringing you a packed issue today, dominated by headlines from Modi’s multi-country visit, with the UAE leading the pack.

The big story today: The India-UAE economic relationship continues to deepen as Modi’s visit unlocks a bag of agreements spanning defense, tech, AI, and energy cooperation. Meanwhile, Emirates NBD is in the last leg of completing its acquisition of RBL Bank.

Plus: Tata Group is charging ahead with its aggressive push into domestic semiconductor manufacturing to secure the tech supply chain. On the geopolitical front, we look at New Delhi's delicate balancing act as it navigates its leadership role within the Brics bloc amid global headwinds. Let’s dive right in.

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M&A WATCH — Emirates NBD’s takeover of RBL Bank almost across the finish line: Emirates NBD has secured all regulatory and governmental approvals required to complete its planned acquisition of a controlling stake in India’s private-sector lender RBL Bank, following final clearance from the Indian government, the Dubai lender stated (pdf).

REFRESHER- Emirates NBD has been pursuing the stake since last year, though the transaction faced regulatory friction and change-of-control reviews earlier this year. India’s central bank then last month approved the takeover of up to 74% of RBL, but voting rights would be capped at 26%. It was pending approval from the Securities and Exchange Board of India, the country’s capital markets watchdog, at the time.

Post-takeover: The roughly USD 3 bn transaction would make Emirates NBD the first foreign lender to take majority control of a profitable listed Indian bank. Structured through a preferential equity issue, the acquisition is expected to leave Emirates NBD with 51-74% of RBL’s share capital and eventually fold its India branches in Mumbai, Chennai, and Gurugram into RBL.

ENERGY — A Suezmax tanker carrying Iraqi crude is headed toward India after crossing the Strait of Hormuz, Bloomberg reports, citing vessel-tracking data from Kpler. Karolos, with a capacity of 1 mn barrels, loaded crude at Basra last week and later appeared in the Gulf of Oman. The vessel is currently sailing along India’s western coast and could dock at Sikka port in Gujarat, where India’s largest private refinery Reliance Industries takes deliveries of energy shipments, according to the latest information on Marine Traffic.

Iran, UAE conundrum for Brics

The Brics foreign ministers’ meeting exposed the same fault line now running through the Middle East. Foreign ministers from the bloc ended two days of talks in New Delhi without a joint statement after Iran and the UAE split over the framing of the war in Iran, Reuters reports. India, which chairs Brics in 2026, issued only a chair’s statement and outcome document, saying members had “differing views” on the Middle East crisis.

The split: Iran wanted Brics to condemn the US-Israeli war on Iran and accused the UAE of direct involvement in military operations. The UAE rejected the charge and said Iran had repeatedly targeted civilian and critical infrastructure during the war. The result was a diplomatic stalemate within the bloc over a joint statement.

Why it matters: The UAE accused Iran of obstructing maritime routes, including Hormuz, through which about a fifth of global oil and liquefied natural gas supplies normally pass. India’s own framing reflected that risk: Foreign Minister S Jaishankar said safe flows through Hormuz and the Red Sea remain vital for global economic well-being.

India’s balancing act: Prime Minister Narendra Modi visited the UAE on Friday and condemned the attacks on the Gulf country, saying the way the UAE was targeted was “unacceptable in any form.” That leaves India trying to manage two tracks at once: chairing a divided Brics platform while protecting energy, shipping, and trade flows through a corridor where two Brics members are now on opposite sides of the conflict.

Heightened scrutiny on overseas investments

The Reserve Bank of India (RBI) is tightening oversight of outbound capital as foreign exchange pressures mount, questioning whether overseas direct investments (ODI) are flowing into bona fide businesses, Economic Times reports. The central bank has sought detailed disclosures on intent, governance structures, and future plans for overseas entities where Indian firms have made investments.

Outflows surge, red flags emerge: Under current rules, an Indian entity can automatically remit up to 400% of its net worth annually for bona fide business. The scale of these flows has raised concerns over fund utilization, particularly as India faces currency pressures and seeks to conserve its forex.

Why it matters: ODI climbed from USD 14.5 bn in FY 2024 to USD 27 bn in FY 2026, with the UAE, the US, and Singapore serving as the primary channels. Regulators are specifically hunting for special purpose vehicles in Dubai and Singapore used by Indian companies to park earnings, dividends, or fees offshore rather than repatriating them to India.

IN CONTEXT- The RBI has sold FX reserves and used regulatory measures to slow the INR’s fall. The RBI has also recommended reducing taxes levied on foreign investors holding sovereign bonds — a proposal being actively mulled by the Finance Ministry — as policymakers seek to align with global norms and attract capital inflows.

FPI outflow is also hitting highs

INVESTMENT — Foreign portfolio investors (FPIs) have accelerated their exit from Indian equities, offloading a record USD 22.9 bn YTD, as per data from National Securities Depository Limited. FPIs have been net sellers in every month of 2026 except February — which saw inflows of USD 27.1 bn, the highest in 17 months — before the Iran war soured the sentiment again.

By the numbers: This capital flight has already eclipsed the USD 18.9 bn pulled out during the entirety of 2025. The selling was heaviest in March, which saw an unprecedented single-month dump of USD 12.1 bn as ripple effects of the Iran war expanded to the Indian economy.

Why it matters: The relentless selling pressure has combined with a widening merchandise trade deficit to hammer the local currency. The INR, which started the year at 90 against the greenback, breached 96 to hit a historic intraday low of 96.25 per USD today. Global asset managers are actively trimming Indian positions.

Also driving the slide: While capital continues to flow into AI-focused companies, funds are being diverted from India — viewed as a relative tech laggard, VK Vijayakumar, chief investment strategist at Geojit Investments, told Hindu Businessline.

Data point

INR 80 tn (USD 836 bn) — that is the amount of investment India’s urban infrastructure will need by 2037 to support urbanization and economic growth, according to a Brickwork Ratings report (pdf). Urban areas are expected to contribute nearly 70% of India’s GDP by 2036, requiring private sector funding to support infrastructure development.

The big story abroad

We got a raft of business and geopolitical updates this morning. The US and Iran seem no closer to a final resolution, with US President Donald Trump warning Tehran that “the clock is ticking.” Iranian media claims that Washington has demanded the removal of the nation’s uranium stockpile without proposing tangible concessions in return. A drone strike on the UAE’s Barakah nuclear power plant has heightened tensions in the region.

Meanwhile, in the world of M&A: French advertising group Publicis Groupe is acquiring data collaboration company LiveRamp in a USD 2.2 bn transaction to expand its foothold in the AI marketing space. The move will allow the group to create proprietary data for clients and develop intelligent AI agents.

And on Wall Street: Investors are sounding the alarm over an apparent market paradox, where bullish sentiment prevails in stocks while bond yields rise sharply, leading some to believe that a drastic shift is overdue. Despite positive market sentiment over robust first-quarter earnings and AI-related developments, higher yields portend costlier corporate spending while offering a safe haven that could draw investors away from equities.

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