World Bank Projects India Will Be the Fastest-Growing Economy until 2018

The Wall Street Journal reports on the new forecasts from the World Bank which says that India is “well positioned to withstand near-term headwinds and volatility in global financial markets” compared with other major emerging economies and predicts it will grow at 7.9% by 2018.

That would make it the fastest-growing developing-country economy by some margin, ahead of the next quickest, Bangladesh, at 6.8% and China at 6.5%, according to the latest  Global Economic Perspectives report published by the bank.

Table below from World Bank Group 2016. Global Economic Prospects, January 2016: Spillovers amid Weak Growth. Washington D.C.

Country

2013

2014

2015 estimate 2016 forecast 2017 forecast 2018 forecast
World

2.4

0.6

2.4

2.9

3.1

3.1

U.S.

1.5

2.4

2.5

2.7

2.4

2.2

Euro Area

-0.2

0.9

1.5

1.7

1.7

1.6

Japan

1.6

-0.1

0.8

1.3

0.9

1.3

United Kingdom

2.2

2.9

2.4

2.4

2.2

2.1

Russia

1.3

0.6

-3.8

-0.7

1.3

1.5

China

7.7

7.3

6.9

6.7

6.5

6.5

Indonesia

5.6

5

4.7

5.3

5.5

5.5

Thailand

2.8

0.9

2.5

2

2.4

2.7

Kazakhstan

6

4.4

0.9

1.1

3.3

3.4

Turkey

4.2

2.9

4.2

3.5

3.5

3.4

Romania

3.5

2.8

3.6

3.9

4.1

4

Brazil

3

0.1

-3.7

-2.5

1.4

1.5

Mexico

1.4

2.3

2.5

2.8

3

3.2

Colombia

4.9

4.6

3.1

3

3.3

3.5

Egypt

2.1

2.2

4.2

3.8

4.4

4.8

Iran

-1.9

4.3

1.9

5.8

6.7

6

Algeria

2.8

3.8

2.8

3.9

4

3.8

India

6.9

7.3

7.3

7.8

7.9

7.9

Pakistan

4.4

4.7

5.5

5.5

5.4

5.4

Bangladesh

6.1

6.5

6.5

6.7

6.8

6.8

South Africa

2.2

1.5

1.3

1.4

1.6

1.6

Nigeria

5.4

6.3

3.3

4.6

5.3

5.3

Angola

6.8

3.9

3

3.3

3.8

3.8

The World Bank said India would benefit because of a reduction in external vulnerabilities, a strengthening domestic business cycle and a supportive policy environment.

 

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January 17, 2016   No Comments

India Bucks Slowdown Trend in Emerging Markets

In a new policy research note ‘Slowdown in Emerging Markets: Rough Patch or Prolonged Weakness?’ the World Bank noted that “growth in BRICS, with the exception of India, has been slowing significantly after 2010. These slowdowns are expected to continue over the near term.”

Emerging market growth has been fading steadily since 2010, slipping from an average 7.6 per cent in 2010 to a projected less than 4 percent this year. Some of the contributing factors have been weak international trade, slowing capital flows and slumping commodity prices, external challenges which have compounded domestic problems including blunted productivity and bouts of political uncertainty, the report added.

The World Bank said that while many emerging markets have implemented reforms in specific areas, a few have announced comprehensive structural reform plans, including China, India, and Mexico. India formally adopted inflation targeting in 2015, thus strengthening the credibility of the central bank, reduced barriers to FDI in insurance, telecommunications, railways, and retail, eliminated diesel subsidies while raising excise duties on petroleum and diesel fuel, approved the introduction of a harmonized goods and services tax, and committed to increasing public investment, it noted reports SiliconIndia News,

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December 11, 2015   No Comments

Global Executives Rate India as Most Attractive Investment Destination

32 percent of 505 global investors named India as the favored market for investment according to a survey published by accounting firm Ernst & Young. China was second with 15 percent of the vote, followed by S.E. Asia, Brazil and N. America.
“There is no doubt that interest in India has increased,” Mark Otty, Ernst & Young area managing partner for Europe, Middle East, India and Africa said.  “Investors increasingly see the potential and understand the fundamentals.”  Industrial policy secretary Amitabh Kant said that the government was “determined to make India an extremely easy and simple place to do business. Our first priority is to do away with the many procedures and rules, followed by bringing in consistency and clarity in all our policies and tax regime and developing a world-class infrastructure.”
Channel NewsAsia reports that according to Financial Times data service, fDi Markets, Greenfield foreign direct investment (new ventures) in India rose 32 percent to $25 billion in 2014 after declining in the previous two years.

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November 10, 2015   No Comments

Indian Economy Shows ‘Firming Growth’ Says OECD

In the September release of the Composite Leading Indicators (CLIs) that are designed to anticipate turning points in economic activity relative to trend, the Paris-based Organization for Economic Cooperation and Development (OECD) said India is expected to see “firming growth”.

As reported on their Website, the CLIs signal stable growth momentum in the Euro area particularly in Germany and Italy, while growth is firming in France. Stable growth momentum is also anticipated in Japan.

In Canada as well as in the United Kingdom and the United States, growth momentum is anticipated to moderate albeit from relatively high levels.

The outlook continues to deteriorate for China, with the CLI pointing more strongly to a loss of growth momentum. Signs of slowing growth momentum are also re-emerging in Russia. In Brazil, weak growth momentum is anticipated.

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October 12, 2015   No Comments

Netflix to Launch Video-on-Demand Services in India

I was in Delhi last week and wanted to continue watching an episode of Scandal on my laptop. But I was blocked because Netflix looked at the Indian IP address of my hotel and said Nope.

So I am releived to learn that according to the Times of India, Netflix has firmed up plans to enter India by 2016. India is a promising market for video-on-demand given that Internet penetration and mobile connectivity are increasing rapidly. A report by one of Silicon Valley‘s leading VC firms, Kleiner Perkins, says that India leads the world’s Internet user growth across all platforms. A KPMG report predicts that India is expected to reach 640 million Internet users by 2019.

India is the second-largest mobile market in the world after China, which has 1.27 billion users; its total mobile subscriber base is at about 970 million, and the 1 billion user mark could be reached by the end of 2015, per the Telecom Regulatory Authority of India.

Potential competitors for Netflix in India include Hooq, Hotstar, Ditto TV and Eros Now, adds The Hollywood Reporter.

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September 26, 2015   No Comments