NEW DELHI // Bangladesh's prime minister, Sheikh Hasina, ended her three-day visit to India last week with a series of treaties and agreements that could, some analysts say, signal a new era in bilateral ties while offering a model of South Asian co-operation.
"It was a very important visit, and the outcome was a new spirit of co-operation now and in years to come," said Mustafizur Rahman, the executive director at the Centre for Policy Dialogue in Dhaka.
Among the agreements reached, the most important were a deal to co-operate more closely to combat terrorism and a pact to open up Bangladesh's two underused seaports to marine traffic not just from India, but also Nepal and Bhutan.
New Delhi agreed to open up Indian transit routes to connect Nepal and Bhutan to Bangladeshi ports, to drop a number of tariffs on Bangladeshi goods and services and to extend an infrastructure credit line of US$1 billion (Dh3.67bn).
This will dramatically improve connectivity and trade throughout the region, while easing Indian access to its seven north-eastern states.
"Yes, we do want better relations, and rightly so," said Srinath Raghavan, an analyst at the Centre for Policy Research in New Delhi. "Since 1973 onwards, we have always suffered from the problem of India as the dominating partner, but now we have a new government willing to risk some kind of domestic opposition to build better ties."
This was Sheikh Hasina's first visit since winning a landslide victory in the presidential election in December 2008. She has played an active role in Bangladeshi politics since the impoverished state separated from Pakistan in 1971, and has always been considered pro-India.
As a sign of the growing goodwill between the two countries, New Delhi awarded her the Indira Gandhi Prize for Peace, Disarmament and Development, worth 2.5 million Indian rupees (Dh200,000), which Sheikh Hasina is donating to charity.
Others were less happy at the warmer relations between the two countries.
The Bangladesh National Party (BNP), led by hardline nationalists, termed the visit a "sell-out" and said it would turn the country into an "Indian market". The party is threatening protests.
Most analysts, however, said the pacts would go a long way to rectifying Bangladesh's chronic trade deficit with India, which is widening at a rate of about five per cent per year. Recent figures put Indian exports to Bangladesh at $2.8bn while imports were just $275 million.
"We need to have a trade balance between the two countries. We want Bangladesh to become a poverty-free country," Sheikh Hasina told Indian industry leaders. Her trip came just days after confirmation that India's Bharti AirTel is buying 70 per cent of Bangladesh's Warid Telecom from the Abu Dhabi Group.
Intra-regional trade accounts for only three per cent of all trade within the South Asian Association for Regional Cooperation (SAARC), said its president, Annisul Huq.
By comparison, intra-regional trade accounts for 52 per cent of trade within the EU, and 28 per cent with the Association of South Eastern Nations area. SAARC comprises India, Bangladesh, Bhutan, Nepal, Pakistan, the Maldives and Sri Lanka.
Significant infrastructure investment will be required for Bangladesh to gain the benefits of these deals, however, including the widening of roads and the expansion of its ports at Mongla and Chittagong, both of which are operating significantly under capacity.
"We need to build up container capacity at Chittagong," said Mr Rahman from the Centre for Policy Dialogue. "But we are also thinking about a second deep-sea port at Chittagong, and this would only be economically viable if we have sufficient trade and commerce, so this is very important."
The pacts also remove hurdles stalling development of the $1bn gas pipeline linking Myanmar to India via Bangladesh.
Dhaka insisted upon a reduction of its trade deficit, and the establishment of a trading corridor for Nepal and Bhutan, as conditions for implementation of a development agreement signed three years ago.
China has since stepped into the breach and is building pipelines to export Myanmar gas, but the fields in question are considered large enough to supply India and Bangladesh as well.
"Something could happen in two to three years with Indian companies such as Gail, Essar Oil, ONGC and IOC exploring gas in Myanmar," Myanmar's ambassador to India, U Kyi Thein, said recently, according to Asia Times.
Mr Rahman confirmed that China had also expressed interest in access to Chittagong as part of its "string of pearls" drive to improve its overall seaport access. But Mr Raghavan at the Centre for Policy Research said Chinese interest was not the driving force behind New Delhi's decision to sign the pacts.
"Access to these ports would help India smooth access to its north-eastern states. This is more internally driven than externally driven," he said. "Beyond that, as a counterpoint to China - I am not convinced that the 'string of pearls' has a strategic purpose rather than a political purpose."
He said the port of Gwadar in Balochistan province of Pakistan, for instance, is being built by the Chinese as a container port and not as a naval base, which has very different requirements. This is just about "building equities with people," Mr Raghavan said.
Most of the agreements are in framework form and details have to be sorted out, but they are expected to include the extension of existing water protocols between the two states, the resolution of some longstanding territorial disputes along the border and the Indian export of 250MW of power to Bangladesh (one megawatt is enough to power 1,000 western homes).
India is expected to cede up to 4,000 hectares to enable the assimilation within national boundaries of a series of small parcels of land held by both countries on either side of the border.
foreign.desk@thenational.ae
What drives subscription retailing?
Once the domain of newspaper home deliveries, subscription model retailing has combined with e-commerce to permeate myriad products and services.
The concept has grown tremendously around the world and is forecast to thrive further, according to UnivDatos Market Insights’ report on recent and predicted trends in the sector.
The global subscription e-commerce market was valued at $13.2 billion (Dh48.5bn) in 2018. It is forecast to touch $478.2bn in 2025, and include the entertainment, fitness, food, cosmetics, baby care and fashion sectors.
The report says subscription-based services currently constitute “a small trend within e-commerce”. The US hosts almost 70 per cent of recurring plan firms, including leaders Dollar Shave Club, Hello Fresh and Netflix. Walmart and Sephora are among longer established retailers entering the space.
UnivDatos cites younger and affluent urbanites as prime subscription targets, with women currently the largest share of end-users.
That’s expected to remain unchanged until 2025, when women will represent a $246.6bn market share, owing to increasing numbers of start-ups targeting women.
Personal care and beauty occupy the largest chunk of the worldwide subscription e-commerce market, with changing lifestyles, work schedules, customisation and convenience among the chief future drivers.
Roll of honour
Who has won what so far in the West Asia Premiership season?
Western Clubs Champions League - Winners: Abu Dhabi Harlequins; Runners up: Bahrain
Dubai Rugby Sevens - Winners: Dubai Exiles; Runners up: Jebel Ali Dragons
West Asia Premiership - Winners: Jebel Ali Dragons; Runners up: Abu Dhabi Harlequins
UAE Premiership Cup - Winners: Abu Dhabi Harlequins; Runners up: Dubai Exiles
West Asia Cup - Winners: Bahrain; Runners up: Dubai Exiles
West Asia Trophy - Winners: Dubai Hurricanes; Runners up: DSC Eagles
Final West Asia Premiership standings - 1. Jebel Ali Dragons; 2. Abu Dhabi Harlequins; 3. Bahrain; 4. Dubai Exiles; 5. Dubai Hurricanes; 6. DSC Eagles; 7. Abu Dhabi Saracens
Fixture (UAE Premiership final) - Friday, April 13, Al Ain – Dubai Exiles v Abu Dhabi Harlequins
More coverage from the Future Forum
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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ABU DHABI CARD
5pm: UAE Martyrs Cup (TB) Conditions; Dh90,000; 2,200m
5.30pm: Wathba Stallions Cup (PA) Handicap; Dh70,000; 1,400m
6pm: UAE Matyrs Trophy (PA) Maiden; Dh80,000; 1,600m
6.30pm: Sheikha Fatima bint Mubarak (IFAHR) Apprentice Championship (PA) Prestige; Dh100,000; 1,600m
7pm: Sheikha Fatima bint Mubarak (IFAHR) Ladies World Championship (PA) Prestige; Dh125,000; 1,600m
8pm: Sheikh Zayed bin Sultan Al Nahyan Jewel Crown (PA) Group 1; Dh5,000,000; 1,600m
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All kick-off times UAE ( 4 GMT)
Brackets denote aggregate score
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Roma (1) v Shakhtar Donetsk (2), 11.45pm
Manchester United (0) v Sevilla (0), 11.45pm
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Besiktas (0) v Bayern Munich (5), 9pm
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Sole survivors
- Cecelia Crocker was on board Northwest Airlines Flight 255 in 1987 when it crashed in Detroit, killing 154 people, including her parents and brother. The plane had hit a light pole on take off
- George Lamson Jr, from Minnesota, was on a Galaxy Airlines flight that crashed in Reno in 1985, killing 68 people. His entire seat was launched out of the plane
- Bahia Bakari, then 12, survived when a Yemenia Airways flight crashed near the Comoros in 2009, killing 152. She was found clinging to wreckage after floating in the ocean for 13 hours.
- Jim Polehinke was the co-pilot and sole survivor of a 2006 Comair flight that crashed in Lexington, Kentucky, killing 49.
