China Expert Lauds India’s Future

China has long been the real engine behind the BRICS but with its own growth slowing now values the concept as a diplomatic forum, says an article in Forbes, written by Hong Kong-based China expert, Douglas Bulloch. The key problem with BRICS has always been that there is little that unites all its member countries aside from a once-shared propensity for high rates of growth, the article adds.

The upshot is that China has huge amounts of infrastructure and an economy that must now service enormous amounts of debt. The staggering GDP growth figures they have achieved over many years have yet to register the consequences of all that investment and if much of it generates little or no return, the consequent write-downs will weigh down on China’s GDP figures for years to come. Some estimate coming write-downs in excess of 35% of GDP, which would mean China’s economy is actually much smaller than its reported GDP.

India, on the other hand, registered a growth rate higher than China last year, and while India’s economy is much smaller than China’s right now, in contrast to China it has a great deal of catch up growth ahead of it, and–again unlike China–has a government with an appetite for structural reform as a key driver for future growth, rather than debt-fueled investment and exports.

Modi at BRICS Summit 2017

Forbes: China, with its enormous debts, closed capital markets, asset bubbles and increasing communist party interference in the economy would look like an entirely different kind of investment prospect than India, with its greater growth potential, favorable demographics, open and pluralist society and reform minded government. Indeed, apart from both being large economies it’s hard to imagine anyone putting the two economies in the same category anymore.

India looks the better bet.

 

 

October 9, 2017   No Comments

Regional Languages Drive India Smartphone Sales Further

With nearly as many smartphone users as the U.S. has people, India is already one of the world’s hottest mobile markets, with America’s Apple, Korea’s Samsung, China’s Oppo, Vivo and Xiaomi jostling for market share with Indian brands such as Micromax.

Nubia Smartphone

India’s 300 million smartphone users could grow by more than 50% in the next few years, reports CNN Tech giving reasons for this:

  1. 1 billion Indians do not yet have a smartphone — a huge market opportunity.
  2. More than 66% of India’s 1.3 billion people still don’t have access to the Internet, and when they do so over the next decade, it will likely be through mobile devices. “Mobile has already become the primary device from which users access the internet,” says Shobhit Srivastava, an analyst at Counterpoint Research, a global industry analysis firm headquartered in Hong Kong.
  3. India has many regional languages, and many of the country’s newest mobile users are discovering the Internet in one of them. “One of the major reasons the smartphone hasn’t been able to penetrate rural or [smaller] cities is because it’s all in English. You need to have the regional languages, and a lot of players have understood that. They are investing in putting regional languages in their smartphones, turning this challenge into a differentiating factor for themselves,” Srivastava added.
  4. India has more than 100 smartphone brands catering to a variety of budgets.

October 4, 2017   No Comments

Gujarat Leads Race to Manufacture Electric Vehicles in India

With the Government of India’s initiative to put 1 million electric vehicles on the roads by 2019 , car and bike makers are preparing to manufacture electric and hybrid systems. The western state of Gujarat is set to become the electric vehicle hub of India.

Ford Motor Co., which has a manufacturing unit at Sanand in Gujarat will partner with Mahindra Group to explore electrification of vehicles as a potential area of co-operation on which they would collaborate and work together for the next three years.

Mumbai-based JSW Group signed an agreement with the government of Gujarat to promote production of battery operated vehicles in the state along with the production of electrical battery, storage solutions and charging infrastructure. The company will invest $700 million (4000 crore) in the project.

Electric car

Suzuki Motor Corporation is gearing up to manufacture EVs in a factory at Hansalpur in Gujarat, and has committed $600 million for the venture.

Tata Motors is looking to revamp its Nano as an EV, in a bid to boost sales; its factory too will be in Gujarat.

Live Mint says that MG Motors India Ltd, a subsidiary of China’s largest auto maker SAIC Motor Corp. Ltd is also considering launching electric and hybrid cars in India. The company has recently taken over General Motors India’s manufacturing facility in Halol, Gujarat “from where we aim to roll out environment-friendly vehicles,” said P. Balendran, executive director at MG Motors India.

September 30, 2017   No Comments

India Tops Kearney’s Global Services Location Index

Extending its lead over other countries, India topped management consulting firm A.T. Kearney’s 2017 Global Services Location Index for the eighth consecutive year since its inception in 2004. Currently there are 200 multinational corporations operating in India and 1.1 million employees in Business Process Outsourcing, though the sector does face challenges from automation.

Live Mint reports that the index is based on metrics in three categories: financial attractiveness, people skills and availability, and business environment. Asian countries continue to dominate the Index with China and Malaysia at second and third spots, while Indonesia rose one place to rank fourth.

map of the world with 'outsource' written across it

According to Kearney, India’s overall financial competitiveness is due to the English-speaking skilled labor that none of the other low-cost countries can match, as well as an improved policy environment.

Ajay Gupta, partner at A.T. Kearney India, said, “Its [India’s] attractiveness as a global services destination continues to increase with its growing cost advantage against the United States, and the improving performance of Indian students on standardized tests.”

September 29, 2017   No Comments

Chinese Group Expects India to Overtake China in Innovation by 2025

According to China’s Science Technology Exchange Center, India’s innovation growth rate will rise significantly over the next 15 years, and come close to surpassing China. “It is predicted that the innovation competitiveness of India will see a significant rise with its growth rate probably surpassing China between 2025-2030,” the independent Chinese research body wrote in its BRICS Innovation Competitiveness Report 2017.

CNBC India reports: India has been taking notable steps forward in innovation, supported in part by Prime Minister Narendra Modi‘s reform agenda. Government initiatives such as Digital India, which expands the country’s online infrastructure, and Startup India, which promotes financial backing for entrepreneurs, have been unveiled to boost the country’s innovation and technology sectors. Meanwhile, the country’s growing information technology and scientific expertise have also helped turn it into an increasingly dominant outsourcing hub.

Innovation Poster

The International Monetary Fund recently forecast India’s GDP to grow 7.2 percent in 2017 versus China’s 6.5 percent. This new study highlights the growth that can be expected in intellectual advances, such as science and technology, which are often perceived as indicators of future growth.

September 15, 2017   No Comments