If more and more private equity (PE) firms are refraining from investing in tobacco, liquor and gambling companies, it shows the growing Arab interest in India. As the oil sheikhs find alternative investment avenues like rupee-backed assets an attractive proposition, PE firms are undergoing a 'purge'. Alok Sama, founder and president of Baer Capital Partners, which recently raised a $250 million PE fund for India, says one-third of the money was from the Gulf region. Sama said the $250 million fund will not invest in alcohol and gambling companies – sin businesses for Gulf investors. “If you examine the books of funds like Carlyle and New Vernon, they raise a chunk of their capital from the Gulf region,” said a PE investor who did not wish to be named. The trend started after 9/11, when a lot of Middle East investors started withdrawing money from the West and looking for safer avenues. Its traditional ties with the Gulf countries and success story among emerging markets made India an obvious destination. […]