Dubai - Economy GDP : : $835 billion in 2009 (compared with $1.1 trillion in 2008). Oil 5%, non-oil 95%. Main non-oil industries: Trade, Tourism. Manufacturing and Transport. Diversified economic base.
Infrastructure Based on Tourism
Recession came into picture Dubai World is Government Company having central role in Dubai economy during the construction boom. They borrowed a sum of US $ 60 billion for investing in real estate development . During the recession, investors from USA and other countries whom invested their money at Dubai want it back. Economic growth has fallen sharply from nearly 8 percent in 2008 to under one percent.
What Happened then More than half of the construction projects in the United Arab Emirates, worth $582 billion, have been put on hold.. Some projects are still going ahead to the value of $10 billion bailout from the UAE's capital, Abu Dhabi.. But, many workers are unemployed and stuck here..
Gulf countries Other Gulf countries were in a position / condition to help UAE by providing subsidiaries . The Saudis, along with other states, have concentrated on infrastructure projects and helping the private sector take a larger role in developing the non-oil and gas sectors. Kuwait Funded for Future Generations of $250 billion. Even Libya had provided $50 billion in its Oil Reserve Fund.
Effect on Global Market Economists fear that the latest Dubai financial crisis could have a major impact around the world. So there was a sudden hike in oil price of $42->$70/barrel. Directly affects the global market as the price of crude oil plays the vital role in the global economy.
Effect on Indian Economy A large number of Indian companies have exposure in the region, and over 4.5 million Indians live and work there.. Indian tourists -nearly 5 lakh tourist visit every year –alomost 5% impact on Dubai economy. Indian workers in Dubai–00.05 % remitance to Indian Economy Investment by Indian bankers ,companies are 2% to Dubai economy. Indian exposure to Dubai economy –staggering 10 to 12 % intermsof investing in properties ,hotel and other business.
Indian Companies India export to UAE stood a $23.92 billion in 09 Dubai world crisis effect Realestate, Baking and Constructions business. NagaarjunConstruction have 440 flat project. L&T invested about $20 cr. Voltas of about Rs.400cr.
Present status The Dubai economy is forecast to remain in recession in 2010, the second year in a row that the emirate has experienced negative growth..