India to Be 3rd Largest Buyer of Passenger Planes

With India set to buy 2.2 new airplanes for each of the 480 aircraft currently in service, it is poised to become the third-largest buyer of commercial passenger planes in the world. The U.S. and China are the only countries to have more pending aircraft orders says a report released by the Center for Asia Pacific Aviation, a Sydney-based aviation think tank.

Boeing predicts that India will need 1,850 new planes over the next two decades, and says that these orders will be worth $265 billion. CNN reports that  220 million Indians flew last year — an annual increase of 20% — and the country is on track to overtake the U.K. as the world’s third-largest aviation market by 2026.

However, there are challenges to this expansion: airlines can buckle under the pressure and become defunct; infrastructure such as airports and traffic control will need to gear up to match India’s aviation boom.

 

A plane in flight

June 9, 2017   1 Comment

India Receives the most FDI, Again

The fDi Report 2017 compiled by fDi Intelligence, a division of The Financial Times Ltd., says that India retained its position as the world’s topmost greenfield destination for Foreign Direct Investment for the second consecutive year, attracting  $62.3 billion in 2016.
China has overtaken the U.S. to become the second biggest destination for FDI by capital investment, with $59 billion of announced FDI, compared to $48 billion in the U.S.
A case of dollar bills
Globally, the real estate sector attracted the most capital investment, with $157.5 billion of announced FDI recorded in 2016. In value terms, coal and natural gas witnessed an inflow of $121 billion, followed by alternate and renewable energy at $77 billion, says FirstPost.

May 29, 2017   No Comments

India’s Dairy Sector Buoyant Despite Global Slump

According to Dublin, Ireland-based Research and Markets, India, the largest producer and consumer of milk globally, should report a 15.6% year-on-year growth in revenues for this year.

India’s demographics and dietary habits have changed over the past two decades, and the demand for cheese, ice cream, and yogurt now takes precedence over the demand for just milk.

Cows in a pastrue

Globally, milk prices have remained low last year because of weak import demand and oversupply. This was compounded by the slow down in the economy of China, Russia‘s ban on EU produce, and the abolition of the EU’s dairy production quotas, says the Dairy Reporter.

April 23, 2017   No Comments

India Could Outpace China with Shifts in U.S. Policy

In a long article, supported ably by charts, the South China Morning Post compares the differences between the economies of India and China, and puts forth reasons why “India could trump China as U.S. policy shifts“.

China's A50 vs India Nifty 50

Highlights of the publication’s views:

SCMP Views on India China
Debt India’s debt ratios are only half of those of China and have not been growing during the past decade The country is awash in debt. China’s total debt (public + private) portends slower growth
Trade Much less export dependent: Exports account for 13 % of GDP Export dependent: Exports total 21 % of GDP
Exports to US: 1.6% of GDP Exports to US: 4% of GDP
India’s lack of dominance in the traded-goods sector may help avoid the ire of a more insular U.S. Vulnerable to any change in the mood in Washington
Politics India doesn’t appear to be on President Trump’s radar and… President Trump has focused his trade concerns on two countries: China and Mexico
… This is good news for India and worrisome for China A trade war with the US could destabilize China’s economy and augment the probability of a debt crisis and a currency devaluation
Currency The Indian rupee is probably about fairly valued Currency is overvalued
India’s FX reserves rose from $326 billion in early 2016 to $337 billion in early 2017 Spent one quarter of its currency reserves defending the renminbi
Equity Markets India’s Nifty Fifty Index has vastly outperformed the China A50 in recent years; trades at 18.6x earnings China A50 trades 12.8x earnings for Chinese shares
Demographics and Agriculture India’s per capita consumption is 2500 calories per day Chinese per capita consumption is now over 3,000 calories per day
India’s population will probably expand by 30% over the next 25 years China’s will probably stay about the same adding about 0.1 per cent to China’s population per year
India represents an enormous opportunity for the world’s farmers, especially those who can provide lentils, peas, chickpeas, almonds and other dietary staples. Also, as India grows richer, consumption of dairy and vegetable oils will probably grow considerably China, by contrast, has a mature diet and its food consumption needs may not change a great deal going forward

April 13, 2017   No Comments

In 2016, India Held $118.2 Billion U.S. Government Securities

Data available with the U.S. Treasury Department showed that India was the 12th largest holder of U.S. government securities at the end of 2016, with exposure worth $118.2 billion in December.  Among the BRIC countries, India stood at 3rd place after China and Brazil in terms of exposure.
US Currency
Japan – $1.09 trillion
China – $1.06 trillion
Ireland – $288.2 billion
Cayman Islands – $263.5 billion
Brazil – $259.2 billion
Switzerland – $229.3 billion
Luxembourg – $223.4 billion
United Kingdom – $217.1 billion
Hong Kong – $191.4 billion
Taiwan – $189.3 billion
Belgium – $120.4 billion
India – $118.2 billion

April 13, 2017   No Comments