New Delhi, Feb 24 (IANS) Businesses are getting cautious across the Middle East and not taking major investment decisions as many believe the political uprisings like in Egypt, Tunisia, Yemen, Libya and Bahrain may alter the strategic balance in the restive region.
‘What is happening in Bahrain is, of course, affecting the business sentiments in other countries in the region. People are apprehensive,’ Adeeb Mohammed Idrees, a Riyadh based businessman, told IANS.
Idrees, general manager of Green Emerald, a company with major interests in investment, trading and diversified manufacturing, said most businesses, especially foreign firms were watching the development anxiously and keeping new projects or expansion on hold.
Political unrest is sweeping the Arab world as popular uprisings toppled governments in Egypt and Tunisia, while Libya, Yemen and Algeria are witnessing widespread protests against their respective governments. There have also been demonstrations in Algeria, Jordan, Iraq and Morocco.
However, what is most disturbing for the businesses in the Gulf region — home to some 5 million Indian diaspora, accounting for nearly 70 percent of the inward remittances of around $57 billion into the country — is the rising political unrest in Bahrain.
‘Bahrain has been a liberal, stable country. What is happening now is quite disturbing,’ chairman of India-Saudi Arabia Joint Business Council Abdulrahman Al-Rabiah, who is heading a business delegation to New Delhi, told IANS.
Rabiah said Saudi Arabia would offer all possible help to Bahrain’s government to crush the revolt and bring back normalcy in the Island.
Accusing Tehran for inciting revolt in Manama, the capital and largest city of Bahrain, Rabiah said a stable and prosperous Bahrain was crucially important for maintaining peace and prosperity in the Gulf region.
The six member states of the Gulf Cooperation Council — Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates — have an estimated total population of 38 million and a $1 trillion collective economies.
The larger Arab world comprises 22 countries and territories spread over parts of North Africa and West Asia, with a total population of 360 million. Their collective gross domestic product was estimated at around $2.75 trillion in 2009.
When asked about the possibility of Bahrain-like unrest in other Gulf countries, Rabiah said: ‘Social composition is different in other Gulf countries. So there is hardly any possibility that this will spread to other countries.’
Kurian Kuriakose, chairman of the Doha-based Morison Menon Chartered Accountants, said such incidents would prompt governments in other Gulf countries to increase spending on job creation, social safety nets and public projects.
‘The events are likely to speed up the participative and inclusive decision-making by the the government,’ Kuriakose said in an e-mail response to IANS from Doha and took the example of Qatar.
He said the Qatari government had started taking proactive measures to create more jobs for citizens by focusing attention to the development of small and medium enterprises and increasing spending on social programmes, especially education and healthcare.
‘I believe the developments will have maximum impact in countries where the economy is not doing well or if it is doing well, where the nationals did not receive the adequate economic opportunities,’ Kuriakose said.
‘Qatar, perhaps, is economically the most progressive in the Middle East and have a very low number of around 300,000 citizens. Most citizens are well to do,’ Kuriakose said.
‘There are also relatively lower number of citizens who have not been able to create a good living condition for themselves in the country. For this reason, I believe, there is minimal impact of these events on Qatar.’
Keeping in view the popular uprisings in the region, Saudi Arabia now has substantially increased its social security budget and boosted its spending on housing by nearly $11 billion in a bid to create more jobs.
Kuriakose said increased social spending will provide a cushion against any possible revolt in these countries.
‘What happens is the Middle East also effects the entire world,’ said Suliman S. Al Othaim, chairman of Suliman Alothiam Jewellery Company.
‘So obviously it is big concern for the people in the Gulf region,’
(Gyanendra Kumar Keshri can be reached at gyanendra.k@ians.in)
