Page 103 - Aamir Rehman - Dubai & Co Global Strategies for Doing Business in the Gulf States-McGraw-Hill (2007)

Here to Stay: GCC Market Attractiveness and Risks 87

UAE, and nonoil trade between the UAE and India is over $14 bil-
lion per year. India’s massive infrastructure needs (more than $300
billion over the next five years) are expected to be significantly
45
funded by GCC investors. Etisalat, the UAE telecommunications
provider, acquired 26 percent and management control of Pakistan
Telecommunications Company Ltd. in Pakistan’s largest privatiza-
tion deal. The UAE-based Emaar is undertaking a massive joint
venture with a Pakistani agency to develop a 12,000-acre zone near
Karachi into a modern city; the Abu Dhabi Group is working on a
joint venture in Lahore to create a 55-story Shaikh Zayed Centre.
One UAE enterprise is also exploring the development of a $5 bil-
lion oil refinery in South Asia. These projects are rooted in funda-
mental economic realities: the GCC has capital to export and needs
large-scale, genuine businesses to fund while South Asia represents
a huge consumer market in need of a vast array of businesses and
infrastructure upgrades.

Capital of the Muslim World

The greater Muslim world is deeply connected with the GCC
states—and especially with Saudi Arabia—due to a common belief
in Islam. Of the over 2 million pilgrims who travel to Makkah each
year, about 1.5 million are foreigners. Even among the domestic pil-
grims, a majority are expatriates taking advantage of their time in
46
Saudi Arabia to visit the holy sites. A hefty $31 billion in spending
(12 percent of the Saudi GDP) is linked to pilgrims and their needs:
transportation, lodging, food, shopping, and other activities. 47
Pilgrims typically purchase gifts for loved ones, further stimulating
the economies of the holy cities of Makkah and Madinah.
Multinational firms and local real estate developers have long
appreciated the economic opportunity provided by religious visi-
tors. Arguably the most conveniently located hotel in Makkah, just
yards from the main entrance to the Grand Mosque, is the Makkah
Hilton. Not far away is Le Meridien, another five-star hotel. Among
the food outlets near the mosque is a prominent KFC. In December
2006, the massive Abraj Al Bait Mall was opened; it includes an
array of international retailers such as Starbucks, Cartier, and
H&M. The mall even contains an amusement park. And this is only
the first step in a larger Abraj Al Bait project, which is envisioned to