AGP Executive Report

West Asia Peace Talks: Pakistan-mediated US-Iran framework is set for an initial deal signing on Sunday, but Iran is urging caution on timing as officials discuss reopening the Strait of Hormuz and easing the naval blockade—an outcome with major knock-on effects for Asia’s energy and shipping. India–France Tech Agenda: PM Narendra Modi’s France trip spotlights innovation and startups at Bharat Innovates 2026, with West Asia’s navigation risks also expected on the bilateral agenda. Northeast Asia Security: South Korea, the US and Japan held trilateral talks in Tokyo on North Korea, reaffirming denuclearisation and sanctions implementation. Trade Outlook: QNB says global trade growth is improving despite protectionism and geopolitics, helped by AI-driven demand and resilient Asian export performance. Energy Transition Pressure: Asia’s renewables push is accelerating as Middle East disruptions raise costs and expose fossil-fuel dependence, with the Philippines facing grid and import volatility. Digital Payments: South Africa’s central bank is looking to India’s UPI model as it plans a free real-time payments system to cut cash use. Climate Watch: El Niño has officially begun, with warnings it could intensify into a Super El Niño—raising flood and storm risks across parts of Asia and beyond. Startup & AI Talent: IIIT Hyderabad’s Souvik Ghosh made Forbes 30 Under 30 Asia for AI-driven neurodivergent care, while Vietnam’s Venture Forum 2026 points to a maturing M&A market.

West Asia Shock to Global Economy: The Middle East conflict is turning into a wider energy, shipping, fertilizer, food and financial drag, with the World Bank warning growth could slow further in 2026 as energy disruptions ripple through 2027. Strait of Hormuz Tensions: The US says it downed multiple Iranian drones targeting commercial ships while insisting traffic through the Strait of Hormuz remains open. US-Iran Deal Signals: Pakistan’s PM Shehbaz Sharif says the final text of a US-Iran peace deal has been agreed, as both sides trade claims of progress. India Trade and Inflation Watch: Economists say India’s May retail inflation at 3.93% is still manageable, but West Asia-linked fuel and food costs are a key risk. Export Pressure on Bangladesh: Bangladesh’s foreign minister says the country must compete harder to sustain exports amid slowing growth and rising trade barriers. Energy Corridor Move: BP confirms operational control of the Baku-Supsa pipeline has been transferred back to Azerbaijan and Georgia, underscoring Europe’s push for non-Russian routes. Regional Trade Push: Sri Lanka is moving toward joining RCEP, aiming to diversify exports and tap the bloc’s scale. Tech and Industry in Vietnam: Intel marks 20 years at its Vietnam plant, highlighting major export output and ongoing investment. AI in Asia-Pacific: Beijing’s HOPE embodied ping-pong AI challenge is set to debut at the 2026 World Humanoid Robot Games.

Energy Shock Watch: A new analysis warns the US-Iran escalation is turning into a wider energy, shipping, fertilizer, food and financial drag that could weigh on global growth through 2027, even if fighting eases. Digital Assets & Finance: Japan’s ruling party backs a yen-backed stablecoin plan for cross-border settlements and a clearer legal path for crypto ETFs, aiming to pair innovation with tighter oversight. Asia Business & Trade: Sri Lanka is pitching Port City Colombo as a South Asia gateway to Gulf investors in Dubai, while Switzerland approved a joint partnership declaration with Vietnam to deepen trade and tech ties. Markets & Tech: SpaceX’s record IPO sent shares soaring and it’s set to join the Hang Seng HK-US Tech Index, spotlighting Asia’s growing role in space-linked investing. Regional Growth: India’s retail inflation held at 3.93% in May, below the RBI’s 4% target, as West Asia-linked costs and El Niño risks loom. Climate: El Niño has officially returned, with forecasts pointing to potentially exceptional intensity.

Markets & FX: Equity mutual fund inflows in India fell 40% in May, as liquidity concerns grow amid the West Asia conflict, a weaker currency and cautious investor sentiment. Energy & Trade Finance: Asia is leaning more on banks for trade finance and risk support as Strait of Hormuz disruptions raise costs and strain supply chains. Protests & Policy: Indonesia faces fresh political heat as students protest fuel-price hikes and demand an end to Prabowo’s free meals programme. Central Asia Minerals: US officials met Central Asian governments in Astana to push critical minerals investment, spotlighting the region’s strategic role in supply chains. ADB Support: The ADB is mobilising $4 billion for 15 Middle East crisis-hit nations, including trade finance for fuel and food imports. India Growth Outlook: The World Bank lifted India’s FY27 growth forecast to 6.6% while cutting global growth to 2.5% on West Asia pressures. AI Governance: Oxford Economics warns that overly restrictive “sovereign AI” rules could cost Japan and India tens of billions by 2035. Business & Mobility: Agoda named We. Communications as its PR agency of record; Virgin Australia confirmed delivery of its first Boeing 737-10 in late 2027. Healthcare Startups: Singapore/Hyderabad preventive health platform YouLabs raised $2.6m seed funding.

World Economy Shock: The World Bank cut its global growth forecast to 2.5% for 2026, its weakest since the pandemic, blaming widening impacts from the Iran war and higher energy prices; it also warned Asia is among the worst hit and pledged up to US$60 billion in immediate support for developing countries. India Outlook: The World Bank raised India’s FY27 growth forecast to 6.6% (from 6.5%), saying domestic demand and resilience are offsetting Middle East spillovers. Markets & Oil: Global stocks slipped as US inflation stayed elevated and oil rose on renewed Iran-US tensions, keeping rate-hike worries alive. Singapore Resilience: Singapore said pressures from West Asia are “manageable” but warned imported cost pressures could rise, as it rolled out CDC vouchers. Energy & Policy in India: At NITI Aayog, Modi and chief ministers stressed making energy “available and reliable” and pushing rooftop solar to reduce grid dependence. Regional Security & Tech: OSCE’s Asia conference in Thailand called for stronger cooperation against digital scams. Business & Trade: China’s 10th China–South Asia Expo opened in Kunming, highlighting trade growth and new cooperation links. Environment & Finance: Environmental groups urged the ADB to halt waste-to-energy funding, calling it a “false solution.” Tech Talent Mobility: Vienna startup JobMetasearch launched an AI platform to help non-EU tech workers find visa-sponsored roles across Europe. Corporate Moves: Microsoft signed its first Asia carbon-removal deal with Alt Carbon, buying credits via enhanced rock weathering.

West Asia Shipping Safety: India told the UN Security Council it strongly opposes attacks on merchant shipping, warning that any targeting of civilian vessels endangers lives and destabilises global trade, as incidents near the Strait of Hormuz continue. Diplomacy Watch: US-Iran talks are reported to be continuing despite fresh exchanges of strikes, while maritime incidents around the region keep seafarers on alert. Korea-US FX Risk: South Korea’s weakening won is seen as a potential hurdle to its planned $350 billion US investment package, with a senior finance official set to meet US Treasury on exchange-rate stability. Bangladesh Growth Milestone: Bangladesh’s economy has crossed the $500 billion mark, hitting $501.1 billion in FY2025-26, with GDP growth at 4.14% as it targets $1 trillion by 2034. Malaysia Ag Tech Push: Wastech plans to position Malaysia as a regional hub for advanced fertiliser technology, including a controlled-release coating plant and expanded crop-specific blending. Singapore Wealth Innovation: DBS will launch tokenized physical gold for retail customers in Singapore via its digibank app, starting in the second half of 2026. Philippines AI Education: University of Asia and the Pacific in Manila will roll out a Bachelor of Science in Artificial Intelligence, aiming to prepare students for AI deployment and responsible governance.

West Asia Shock to Markets: Asia shares slid after Wall Street’s tech sell-off as oil climbed on renewed US-Iran strike risks near the Strait of Hormuz, keeping inflation and rate-hike worries in focus. North Korea-China Pivot: Xi Jinping and Kim Jong-un signalled a new upgrade in ties after Xi’s Pyongyang visit, while analysts note the nuclear issue is conspicuously absent from state messaging. Cybersecurity: CrowdStrike says North Korean hackers posing as remote IT workers drove about half of “hands-on keyboard” intrusions at US tech firms, targeting data and crypto. AI & Chips: Wall Street’s whiplash hit memory and AI chip names, while Europe pushes sovereign chip manufacturing with a fully European semiconductor flow. Trade & Diplomacy: The 10th China-South Asia Expo opens in Kunming with hundreds of free booths for South Asian firms, and Sri Lanka moves toward joining RCEP. UAE-Asia Business: UAE and Australia deepen export-finance cooperation, while India-UAE ties expand across trade, energy and technology. Regional Politics: South Korea’s election controversy over ballot shortages sparks a youth-led backlash.

Middle East Risk to Trade: An economist says Persian Gulf economies are taking a hit from limited Strait of Hormuz transit and damage tied to US-Iran tensions, with investor worries focused more on infrastructure risk than attacks alone. Central Banking & FX: Indonesia’s central bank governor signalled it will let bond yields rise to support the rupiah, even as it keeps the door open to further rate hikes. India Macro & Markets: A brokerage expects the rupee to average around 96 per US dollar in FY27, but warns of downside from oil, the dollar, and geopolitics. AI & Jobs: Tata’s chairman said AI agents could replace half of TCS jobs over time, as firms shift from hiring to automation. Semiconductors: TSMC reported May 2026 net revenue of about US$13.25 billion, up 30% year-on-year. Cyber & Data Security: Munich Re named new cyber heads for Asia-Pacific and Africa, while Colt and Ciena demonstrated record quantum-safe transatlantic data transmission. Logistics for Data Centres: DHL Supply Chain added 160,000 sqm of Asia-Pacific warehousing for data-centre logistics, including Malaysia and Thailand expansions.

West Asia Shock: Gulf energy losses are mounting, with Crescent Petroleum saying the war has become a “whole-economy” hit as Strait of Hormuz disruption ripples into fertiliser, helium and semiconductor supply chains. Shipping & Tariffs: Trans-Pacific peak season is starting early, with new U.S. forced-labour tariffs and higher fuel costs pushing container rates sharply higher. Bangladesh Economy: Bangladesh’s new fiscal year opens under stubborn inflation, weak investment, fragile banks and export pressure, with jobs framed as the route to “dignity, security and opportunity.” India Politics & Jobs: India’s opposition Congress challenges Modi’s 12-year record on employment, inflation and governance, arguing promises haven’t translated into real outcomes. Central Asia Water: The GEF-backed CAWLN Water-Land Nexus launches across five countries to tackle water scarcity and land degradation for 60 million people. Tech & Trade: ESCAP and ADB say AI use in trade facilitation remains below 15% across economies, despite growing interest. Energy Finance: Japan signs a concessional loan deal to help Bangladesh cushion higher energy costs and stabilise supplies. AI in Facilities: YY Group plans humanoid-robot deployments to boost labour efficiency in commercial sanitation and maintenance.

Semiconductor Power Crunch: Tokyo Electron boss says data centres need “must-have” power-focused chip advances as demand surges. China–North Korea Ties: Xi Jinping met Kim Jong Un, pledging to lift relations amid sanctions and shifting Northeast Asia power dynamics. China Exports on AI Boost: May exports rose 19.4% as chips, autos and high-tech demand offset Middle East energy shock worries. CPEC 2.0 Digital Pivot: China-Pakistan cooperation is shifting from roads and power to AI, cloud and surveillance tech—raising geopolitical stakes. West Asia Fallout for Asia Markets: Oil and equities swung as Israel-Iran tensions eased then stayed fragile, with investors still watching rates and geopolitics. Trade Friction Hits Supply Chains: US forced-labour tariffs proposal could disrupt Southeast Asia’s trade flows. Aviation & Energy: US jet fuel output hit record levels as Hormuz disruption reshaped global supply. Business Moves: Bombardier to nearly double its Singapore service footprint; Gentrack adds senior global leadership; Singapore fintech Handshake and maritime tech Clear Robotics raise funding. Policy & Diplomacy: Canada MPs plan a Taiwan visit despite China’s “hurtful” warning.

Markets & Tech: Asia stocks slid again as a global tech sell-off hit AI-linked names, while oil jumped on renewed Israel-Iran fears and rate worries kept investors cautious. Nvidia & AI Infrastructure: Nvidia announced “gigawatt-scale” AI data centre plans in South Korea with SK Telecom, plus memory-chip partnerships with SK hynix, as Seoul debates how AI profits should be shared. Geopolitics & Energy: Iran warned it could target other regional energy infrastructure if attacks continue, as India urged de-escalation and reiterated travel advisories. India Economy & Policy: India’s FY26 growth was cited at 7.7%, with the government pushing reforms and launching BHAVYA to build 100 investment-ready industrial parks. Climate Finance: Saudi Awwal Bank joined PCAF to measure and disclose financed emissions, aligning with Saudi Vision 2030. Trade & Industry: Thailand moved ahead with a 13-billion-baht U-Tapao MRO push, while Bangladesh’s business delegation is set to join China’s Kunming and South Asia expos. Digital Safety: Australia’s under-16 social media ban is prompting similar age-restriction proposals across Asia and beyond.

Japan-Malaysia Ties: Malaysia’s PM Anwar Ibrahim’s visit to Japan (June 8-10) is set to unlock cooperation on defence and regional security, healthcare, energy transition, environmental work and higher education, with four MoCs and two letters of intent expected. Digital Infrastructure: Digital Realty is launching a Malaysia multi-site data centre campus in Cyberjaya, targeting about 32MW capacity for AI and high-performance computing, with further expansion planned by mid-2028. North Korea Watch: Xi Jinping arrives in North Korea for talks with Kim Jong Un, aiming to reaffirm China’s influence and deepen ties amid separate US confrontations. Markets & Energy Shock: Asia stocks slid as tech retreated and Middle East tensions lifted oil prices, feeding inflation worries; India’s FMCG demand held up despite cost pressures. Business & Deals: Nazara Technologies raised over Rs 474 crore via warrant issuance for acquisitions and growth; Carlyle agreed to buy South Korea’s Chung Ho Group in a deal reported around $700m. Aviation: Delta resumes direct Hong Kong–Los Angeles flights, despite higher fuel costs.

Energy & Trade: ADB is preparing a $10m technical assistance grant to kick-start its Pan-Asia Power Grid Initiative, aiming to expand cross-border electricity trade and speed up renewable integration across Asia-Pacific. Aviation: IATA cut its 2026 airline profit outlook to $23b from $41b, blaming West Asia war disruptions and higher fuel costs; separately, Philippine Airlines signed an MoU to join oneworld, bringing a major Asia-Pacific independent carrier into the alliance. Oil Markets: OPEC+ approved a second straight July output increase of 188,000 bpd as it gradually unwinds earlier voluntary cuts, while Japan pushes energy-resilience plans (POWERR Asia/AZEC 2.0) amid Strait of Hormuz risks. India Economy: World Bank Executive Director Neelkanth Mishra said India can sustain 8%+ growth despite crude price worries, and RBI’s cautious stance is being watched as inflation risks rise. Tech & Markets: AI-led trading is reshuffling Asia’s stock markets, with South Korea and Taiwan’s chip surge drawing attention as investors reassess the “AI bubble” risk. Crypto Regulation (Vietnam): Vietnam’s State Securities Commission says crypto assets are now formally recognised under its digital economy framework, with a regulated trading pilot planned for Q3 2026.

Clean Energy Deal: Acwa Power Philippines and Emerging Power (EPI) have signed a joint development agreement to pursue up to 5,000MW of renewable and gas-fired capacity in the Philippines, with a near-term focus on bids for the government’s Green Energy Auction Program. Aviation Security: Sri Lanka’s CAASL chief Captain Daminda Rambukwella has been named chair of the Asia-Pacific Aviation Security Programme for 2026/27, ahead of major regional security summits in June. Tech & Growth: Vietnam’s VNG, now listed on UPCoM, set 2026 targets for revenue growth of 15-25% and expects pre-tax profit of 300-450 billion dong as it leans on gaming, messaging, payments and AI. Tourism Boom: China is set for rapid tourism expansion, with WTTC data citing 68 million international visitors in 2025 and a sector value of $1.8 trillion. Energy Costs in Focus (India): India raised domestic LPG by ₹29 to Rs 942 per 14.2kg cylinder in Delhi, but the government says households still pay far below the import-linked cost (over ₹1,600) due to subsidies, including PMUY’s effective Rs 642 rate. Digital Inclusion: India’s BHASHINI DPI unit and Kathmandu University will work on multilingual language AI and digital public infrastructure for India-Nepal, including Nepali datasets and voice-first translation.

India Growth Watch: India’s economy grew 7.8% in Jan–Mar 2026, beating forecasts, while full-year FY25-26 GDP rose to 7.7%—a bright spot even as West Asia tensions threaten energy and trade routes. Policy Response: PM Narendra Modi chaired an EAC-PM meeting on sustaining growth, pushing “ease of living” and “ease of doing business” reforms, and assessing how the West Asia conflict could hit energy markets, shipping and stability. Global Outlook: Fitch cut its 2026 global growth forecast to 2.4%, blaming an oil shock and higher inflation, even as AI and tech investment offer some cushion. Energy Pressure: Economists warn higher petrol and diesel costs could strain household budgets as crude prices climb amid Strait of Hormuz risks. AI & Jobs: A Bangladesh CEO survey finds over one-third expect AI to cut junior roles, while a Philippines World Bank official says the country should move up the AI value chain to capture investment and jobs. Regional Business: Oman’s sovereign reforms are praised for boosting state enterprise profitability, and DHL is testing autonomous vehicles in Singapore logistics to improve efficiency. Sports & Culture: Oman Cricket won ICC Asia’s Digital Fan Engagement award, highlighting digital-first fan outreach.

India Growth Watch: India’s FY26 GDP grew 7.7% and Q4 accelerated to 7.8%, with services and industry driving momentum even as West Asia tensions threaten energy and supply chains. Policy Signals: PM Modi met the Economic Advisory Council to discuss measures to sustain growth, while the RBI kept the repo rate at 5.25% and cut FY27 growth forecasts to 6.6% amid higher oil-linked risks. Global Energy Shock: The Strait of Hormuz is back in focus as a major threat to trade and inflation, with economists warning impacts could rival COVID-era levels if disruption drags on. Tech Market Mood: Wall Street slid sharply as a tech sell-off hit AI and chip stocks, while investors digested a strong US jobs report that raises the odds of higher rates. Sanctions & Trade: The US sanctioned a network accused of shipping Iranian LPG disguised as Omani fuel across Asia, tightening pressure on Iran’s shadow trade. Regional Business Links: Hong Kong’s John Lee led a delegation to Uzbekistan, signing dozens of deals to deepen trade, investment and high-tech cooperation. Digital Safety: Philippines consumers face frequent scam attempts, with reports citing rising social-media fraud and AI-enabled tactics.