800 Indian MSMEs At Risk, ₹12,000 Crore UAE Investment Faces Uncertainty Amid Iran-US Conflict Impact
Around 800 Indian firms face risk to USD 1.3 billion UAE investments due to Iran-US tensions. Retail and hospitality sectors are worst hit. Small companies lack financial strength and war insurance. Experts see short-term disruption but remain positive on UAE’s long-term investment potential.
Around 800 Indian firms face risk to $1.3 billion UAE investments due to Iran-US tensions. |
Mumbai: Around 800 small and mid-sized Indian companies are facing serious risk to their investments due to the ongoing Iran-US conflict. As per the Moneycontrol report, these firms have collectively invested about USD 1.3 billion (around Rs 12,000 crore) in the United Arab Emirates (UAE) over the last six months.
The war has disrupted travel, trade, and business activities across the Middle East. As a result, these investments are now under pressure and may suffer losses.
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Retail and Hospitality Hit the Most
The biggest impact is being seen in the retail and hospitality sectors. Nearly 280 Indian companies have invested close to USD 400 million in these sectors alone.
These businesses depend heavily on customer movement and tourism, both of which have slowed due to rising tensions in the region.
Why Small Firms Are More Vulnerable?
Experts say small and mid-sized companies are at higher risk compared to large corporations. This is because they have limited financial strength and cannot absorb heavy losses easily.
Another major concern is that most of these companies do not have active war insurance policies. This increases the risk of financial damage if the situation worsens.
UAE Remains a Key Investment Hub
Despite current challenges, the UAE continues to be an important destination for Indian investments. Over the past two years, it has become the second-largest foreign investment location for Indian companies after the United States.
Experts believe that while short-term problems may continue, the long-term potential of the UAE market remains strong.
Examples of Company Investments
Several Indian companies have recently invested in the UAE. Mumbai-based coffee brand ‘Subko Coffee’ invested USD 210,000 in its subsidiary. Brahm Lifestyle Products invested USD 2 million, while Idam Natural Wellness invested about USD 680,000.
Larger firms have also made investments. Graviss Foods invested USD 11.4 million, Haldiram Snacks put in USD 2.8 million, and Oyo’s subsidiary Oyo Proptech invested around USD 11 million in the Gulf region.
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