DUBAI - Al-Qaida leader Ayman al Zawahri on Wednesday announced the formation of an Indian branch of his militant group he said would spread Islamic rule and "raise the flag of jihad" across the subcontinent.

In a 55-minute video posted online, Zawahri also renewed a longstanding vow of loyalty to Afghan Taliban leader Mullah Omar, in an apparent snub to the Islamic State armed group challenging al-Qaida for leadership of transnational Islamist militancy.

Zawahri described the formation of "Al-Qaida in the Indian Subcontinent" as a glad tidings for Muslims "in Burma, Bangladesh, Assam, Gujurat, Ahmedabad, and Kashmir" and said the new wing would rescue Muslims there from injustice and oppression.

Counter-terrorism experts say al-Qaida's ageing leaders are struggling to compete for recruits with Islamic State, which has galvanised young followers around the world by carving out tracts of territory across the Iraq-Syria border.

Islamic State leader Abu Abu Bakr al-Baghdadi calls himself a "caliph" or head of state and has demanded the loyalty of all Muslims.

The group fell out with Zawahri in 2013 over its expansion into Syria, where Baghdadi's followers have carried out beheadings, crucifixions, and mass executions.

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