Happy Sunday everyone!

The UAE is making moves on multiple fronts: teaming up with India and Sri Lanka to develop a strategic energy hub in Trincomalee, and introducing new tax reforms to boost its appeal as a global investment destination. Meanwhile, in Washington, the Trump administration has approved a $24 million assault rifle sale to Israel, reversing a Biden-era hold amid renewed concerns over West Bank settler violence against Palestinians.

Let’s dive in!

But before that: You can join our Whatsapp channel too to receive updates from the business world.

For quick daily updates, follow us on Instagram, and you can watch our Smashi Business Show live every weekday from 10AM onwards (UAE time).

UAE Joins India and Sri Lanka in Developing Strategic Trincomalee Energy Hub

📰 What is it about?

• The United Arab Emirates, India, and Sri Lanka have signed a landmark agreement to jointly develop an energy hub in Trincomalee, a strategically located natural harbour in eastern Sri Lanka.

• The trilateral pact was signed during Indian Prime Minister Narendra Modi’s visit to Colombo — the first foreign leader visit since President Anura Kumara Dissanayake took office in September 2024.

• The UAE’s role in the project will be defined in upcoming business-to-business discussions, according to Indian Foreign Secretary Vikram Misri.

• The energy hub will include the construction of a multi-product pipeline and potentially utilise a World War II-era oil tank farm currently managed in part by the Sri Lankan subsidiary of Indian Oil Corporation.

💡 Why it matters?

• The UAE's participation strengthens its energy diplomacy in South Asia, positioning itself alongside India in a region where China has been expanding influence — notably through Sinopec’s $3.2 billion refinery project in Hambantota.

• The move is a strategic pushback against growing Chinese presence in Sri Lanka, reinforcing New Delhi and Abu Dhabi’s energy cooperation in the Indian Ocean.

• Trincomalee’s deep natural harbour gives this hub significant geopolitical importance, adding another layer to UAE’s growing global energy footprint.

• For Sri Lanka, the deal represents continued recovery support after its 2022 financial crisis, following India’s $4 billion assistance and new renewable energy investments.

🔜 What’s next?

• The three countries will now identify and appoint business entities to assess the feasibility and financing of the Trincomalee hub.

• Detailed discussions will determine the UAE’s exact role and investment structure in the project.

• Broader cooperation frameworks between India and Sri Lanka have also been strengthened, with agreements signed on digitalisation, energy grid connectivity, healthcare, and security.

• Modi also inaugurated a $100 million solar power project — a joint venture between India’s NTPC and the Ceylon Electricity Board — further expanding Indian and Emirati presence in Sri Lanka’s energy ecosystem.

ODEUM – A Cutting-Edge Content Studio for All Your Production Needs

📰 What is it about?

• Odeum, the content studio built for modern media consumption, partnering with brands to deliver tailored content services while also creating original productions under the Augustus Media network.

💡 Why Choose ODEUM?

At ODEUM, we provide end-to-end media solutions to elevate your brand across multiple platforms.

• Video Production: From AI-powered videos to immersive live streaming and CGI storytelling.

• Animation Services: Dynamic 2D & 3D animation, motion graphics, and visually striking CGI. 

• Audio Production: Podcasting, sound design, and professional voiceovers that elevate content with immersive audio experiences.

• Original Content Development: Conceptualizing and producing shows, short films, and series that engage and inspire.

• Studio Rental: Fully equipped production spaces designed for seamless content creation, offering state-of-the-art filming, podcasting, and photography setups to bring creative visions to life.

🔜 What’s next?

• Have a project in mind? Let's make it happen!

• Book a studio or discuss your next big idea with us today.

Follow ODEUM on LinkedIn, Instagram, Facebook, and X.

Markets

Trump Administration Greenlights $24M-Worth, 20,000 Assault Rifle Sale to Israel

📰 What is it about?

• The Trump administration has approved the sale of over 20,000 U.S.-made Colt Carbine 5.56 mm fully automatic rifles to Israel, worth $24 million, according to a State Department document seen by Reuters.

• The weapons are intended for the Israeli National Police, with the deal formally notified to Congress on March 6.

• This move revives a deal that had been delayed by the Biden administration over concerns the rifles could end up in the hands of extremist Israeli settlers in the occupied West Bank.

• The rifle sale, while small in monetary value compared to larger U.S.-Israel arms packages, has attracted attention due to its timing and political implications.

💡 Why it matters?

• The decision underscores a significant shift in U.S. policy under Trump, who rescinded Biden-era sanctions on violent Israeli settlers on his first day in office.

• Human rights concerns had led Democratic lawmakers to push for a hold on such arms transfers amid increasing settler violence in the West Bank.

• Israeli National Security Minister Itamar Ben-Gvir — known for far-right positions — oversees the police force and has emphasized arming civilian security squads following the October 7 Hamas attacks.

• The Biden administration had previously withheld the rifle sale, even after congressional committees cleared it, reflecting U.S. unease over the weapons' end use.

• This development comes amid broader arms sales to Israel: the U.S. Senate recently voted overwhelmingly (82–15, 83–15) to reject resolutions blocking $8.8 billion in bomb and weapon sales over human rights concerns.

🔜 What’s next?

• The State Department has yet to clarify whether the Trump administration secured assurances from Israel on how the rifles will be used.

• Human rights advocates and some lawmakers are expected to continue pressing for oversight, particularly as West Bank violence persists.

• The transaction is likely to further polarize debate in Washington over U.S. military support to Israel amid the ongoing genocide in Gaza, which has resulted in over 50,000 Palestinian deaths, according to Gaza health authorities.

• With Trump reaffirming his close alliance with Israeli Prime Minister Benjamin Netanyahu, further arms deals could follow — potentially drawing renewed domestic and international scrutiny.

UAE Rolls Out New Tax Rules to Strengthen Its Position as a Global Investment Hub

What is happening?

• The UAE Ministry of Finance has introduced updated tax regulations aimed at attracting more investments by offering preferential tax treatment for Qualifying Investment Funds (QIFs) and Qualifying Limited Partnerships.

• The reforms focus on simplifying compliance for investors, especially foreign entities, while aligning with global tax transparency standards.

• These changes are part of the UAE’s broader strategy to solidify its reputation as a leading international investment destination.

Why it matters:

• Investors in QIFs can now benefit from corporate tax exemptions if their fund meets the 10% real estate threshold and ownership diversity requirements.

• A new grace period offers QIFs flexibility to rectify temporary breaches in ownership diversity without losing their tax-exempt status, provided the breaches are minor and time-bound.

• Importantly, penalties for violations will be limited to the breaching investors, rather than affecting the entire fund — ensuring fairer enforcement.

• Even when the real estate threshold is exceeded, only 80% of the income will be taxed, mirroring the treatment given to REITs, making real estate investing more attractive.

• For foreign investors, tax registration obligations have been simplified: entities meeting distribution requirements will only register on the dividend distribution date, easing compliance pressures.

What’s next?

• These updates are expected to attract more global capital into UAE-based funds and real estate projects, especially from institutional and foreign investors.

• Limited partnerships will now be able to achieve tax-transparent status, bringing UAE tax practices in line with international norms.

• As the UAE continues to refine its tax and investment framework, it sends a strong message to global investors: the Emirates are open for business, competitive on tax, and serious about regulatory modernization.

🔍In other news…

• Safeer Mall Sharjah closure: New management reveals interim name, AED1 billion renovation plan.

• Land deals lead the way in Dubai real estate market.

• UAE maintained its rising performance in global competitiveness race in Q1 2025.

The Latest from the Smashi Business Studio

Were you forwarded this email? Subscribe here