SBI may start Saudi Arabian services soon
State Bank of India (SBI), the country's largest commercial bank, may soon get a green signal to start its financial operations in Saudi Arabia, according to a Saudi government official.
SBI's proposal to start offering full-fledged banking services in Saudi Arabia has been pending with the authorities there since mid-2003.
"The proposal of State Bank of India for opening a branch in Saudi Arabia is being processed by the authorities there," said Saleh Mohd Al Ghamdi, Saudi Arabia's envoy to India.
"While I can't give you a definite time-frame within which the final approval will come I hope it would happen soon," Ghamdi, who is Kolkata to participate in the Confederation of Indian Industry (CII) Partnership Summit 2005, told the agency in an interview.
The Mumbai-headquartered bank's officials were not immediately available for comment.
SBI has already unveiled an ambitious plan to expand its footprint in the global market through a series of acquisitions and setting up of wholly owned branches.
SBI has 54 offices in 28 countries. The bank plans to expand its reach by increasing its offices to 70 in 36 countries. Its international business operations generate revenues to the tune of $6 billion.
The bank, which is likely to announce an acquisition deal in Asia or Africa soon, generates between five and six percent of its profits from overseas operations.
SBI plans to increase overseas operations' contribution to profit to 15 to 20 percent within the next two to three years.
"When State Bank of India starts operations in Saudi Arabia, it will be the first and the only Indian bank to have a presence in our country. It will give a big boost to the bilateral business relations," said Ghamdi.
"We already have banks from European and other countries doing successful business in Saudi Arabia. I don't see any reason why Indian banks can't do the same," added the envoy.
He said India was amongst the top 10 trading partners of Saudi Arabia, fourth largest in terms of exports from Saudi Arabia and ninth largest in terms of imports.
India procures 23 percent of its crude oil requirement from Saudi Arabia. The two countries have significant trade relations and are economic partners in investment and joint ventures.
"The prospects for investments have improved in Saudi Arabia. There are unlimited areas of investment and joint ventures in industry, trade and finance," said Ghamdi.
He said a high-profile Saudi Arabian business delegation, expected to be the largest till date, is set to visit India next month to explore business joint ventures in a vast segment of industrial segments.