Invest in holy cities: Saudi Arabia allows foreign investment in Mecca and Medina

RIYADH: Foreign investors can now invest in Mecca and Medina, the holy cities for Muslims, in Saudi Arabia. The Saudi Arabian market regulator has announced that foreign investors can invest in listed companies that own real estate in Mecca and Medina. This move is part of Saudi Arabia's strategy to attract global investments and increase funding availability for projects in these major religious cities.

Mecca and Medina
Mecca and Medina, considered sacred by Muslims, see millions of believers visiting each year, primarily to perform Hajj and Umrah. These pilgrimages are among the most important sources of revenue for Saudi Arabia. In the year 2019, Saudi had earned $12 billion from the two pilgrimages. By 2030, Saudi Arabia aims to increase this revenue to $30 billion. The campaign named Vision 2030, also focuses on increasing revenue from various sources.

What foreign investors need to know

1. Investments are limited to listed companies that own real estate in Mecca and Medina.
2. Foreigners can invest in shares or convertible debt instruments.
3. Strategic investors will not be eligible to invest.
4. No non-Saudis can own more than 49% of any company's shares.

Golden opportunity for Indians
Indians will also be able to participate in these investments. However, they must comply with the regulations set by the Capital Market Authority. India is the largest source of pilgrims to Mecca and Medina, with 139,000 Indians performing Hajj in 2023. In 2024, this number slightly increased to 139,964. The new law opens up opportunities for Indian investors to engage with the region while supporting their community’s religious journeys and needs. It is expected that more overseas Indian investors will take advantage of this opportunity.