The US investment giant is partnering with billionaire Mukesh Ambani’s Reliance to create a new asset management platform
Larry Fink, CEO of US investment corporation BlackRock, has visited India to meet his new business partner Mukesh Ambani, who is Asia’s richest man with a net worth of $91.4 billion, as well as Prime Minister Narendra Modi, the Economic Times (ET) reported on Tuesday, citing sources.
Fink’s visit followed a deal to create a joint venture between BlackRock and Jio Financial Services (JFC) – the demerged financial lending arm of the Ambani-led conglomerate, Reliance Industries. In July, the companies announced a plan to invest up to $150 million in a 50-50 asset management venture named Jio BlackRock.
After meeting the tycoon and the Indian leader in New Delhi, the head of BlackRock – which manages assets worth over $9 trillion – toured the JFC campus in Navi Mumbai, Maharashtra, and Reliance’s high-end retail center in the Bandra Kurla Complex, the report said. The asset manager also held discussions with top executives at Reliance.
Fink’s visit to India was “primarily aimed at strategizing and building on previously announced plans,” the report stated.
The new joint venture between BlackRock and JFC would deliver “tech-enabled access to affordable, innovative investment solutions for millions of investors in India,” becoming the 44th player in India’s booming mutual fund industry, worth around $530 billion, the financial news website Mint reported in July.
The move is expected to leverage BlackRock’s current digital platform called Aladdin, or the ‘Asset, Liability, and Debt and Derivative Investment Network.’ According to Hitesh Sethia, the CEO of JFC, who was cited in the joint statement, “the partnership will leverage BlackRock’s deep expertise in investment and risk management along with the technology capability and deep market expertise of JFS to drive digital delivery of products.”
BlackRock’s joint venture with Ambani would be the firm’s second foray into the Indian market. In 2018, Fink sold his share in the firm’s previous alliance with another Indian company, the DSP Group. Approximately 15% of BlackRock’s investments in Asia, amounting to $422 billion, are in India, ET estimated. BlackRock manages $13 billion in direct Indian exposure, according to investing.com.
Both Reliance and BlackRock have been vocal about their ‘clean energy’ agenda. In 2021, Ambani announced that all Reliance businesses would achieve “net-zero carbon emissions” by 2035. The Indian tycoon’s agenda is in line with the government’s goal to achieve “net zero” by 2070. BlackRock has faced push-back from US Republicans over Flink’s stance on environmental, social and governance (ESG) investing. In 2022, 18 US state attorneys general sent a letter to BlackRock, arguing that its goal of moving towards a net-zero economy was in conflict with its fiduciary duty. The firm denied the claims.
October 25, 2023 at 04:09PM