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India is setting a global benchmark with its forecasted annual growth rate of 7.3% for the fiscal year ending in March 2024. This impressive figure positions India as a leader among the major global economies. The timing is particularly significant as it precedes the national elections, offering a potential boost to Prime Minister Narendra Modi's campaign.
The National Statistical Office (NSO) has labeled these figures as preliminary projections for 2023/24. In a reinforcing move, the Reserve Bank of India (RBI) has upgraded its GDP growth forecast lately to 7%, an increase from its previous estimate of 6.5%. This revision strengthens confidence in India's economic trajectory.
Against this backdrop, below we highlight a few reasons for which India ETF investing is worth a watch. ETFs like iShares MSCI India Small-Cap ETF (SMIN - Free Report) , VanEck Digital India ETF (DGIN - Free Report) , Columbia India Consumer ETF (INCO - Free Report) , VanEck India Growth Leaders ETF (GLIN - Free Report) and WisdomTree India Earnings Fund (EPI - Free Report) added in the range of 3.4% to 2% in the past one month (as of Jan 18, 2024) against just 0.3% uptick in the S&P 500.
Emergence of a Global Consumer Market
India's economy is undergoing a significant transformation, shifting towards becoming a consumption-focused economy. Rising disposable incomes are fueling this shift, with around 100 million people projected to reach an annual income exceeding $10,000 by 2027, per Goldman Sachs, as quoted on CNBC.
As incomes rise, there's a growing desire for discretionary spending on items like travel, jewelry, and dining out. This shift is expected to drive significant growth in consumer sectors. India's consumer market is set to become the world's third-largest by 2027, driven by the increasing number of middle- to high-income households, according to Goldman Sachs. A significant portion of India's population, around 33%, falls within the 20 to 33 years age group, making it an attractive market for global firms.
India's Tech and Business Ambitions
India is actively promoting itself as a global hub for technology and business. States like Maharashtra, Tamil Nadu, Telangana, and Karnataka are positioning themselves as tech hubs for manufacturing and AI development, as quoted on CNBC.
Major tech companies, including Apple, Google, and Amazon, have made significant investments in India. Apple, for instance, opened its first store in Mumbai, signaling the importance of the Indian market.
India is actively courting investment from U.S. chipmakers. Companies like AMD and Micron are planning substantial investments in the semiconductor industry in India.
Bullish Economic Growth Prospects
Rahul Bajoria from Barclays Investment Bank credits India's robust growth to effective government economic management, highlighting its resilience despite global economic weaknesses, as quoted on CNBC. S&P Global Ratings projects India as the fastest-growing major economy for the next three years, with expectations of it becoming the world’s third-largest economy by 2030, surpassing Japan and Germany.
Upcoming General Elections: Modi Likely to Win?
General elections are scheduled in India between April and May, where market-friendly Prime Minister Narendra Modi seeks reelection. Modi's tenure has seen significant investments from U.S. tech giants in India.
Sustaining a growth rate above 7% for a third consecutive year, particularly in a global slowdown context, could significantly enhance Modi's chances of securing a third term.
Foreign direct investment in India has surged in recent years, increasing from $36 billion in 2014 to $70.9 billion in 2023. This influx of investment is driven by India's growing reputation as a business-friendly destination.
Bottom Line
India's stability as a democracy, with popular leadership, is seen as a significant advantage. The country's stable political environment and strong economic growth position it favorably on the global stage.
(Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.)
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4 Reasons Why India ETFs Worth a Bet
India is setting a global benchmark with its forecasted annual growth rate of 7.3% for the fiscal year ending in March 2024. This impressive figure positions India as a leader among the major global economies. The timing is particularly significant as it precedes the national elections, offering a potential boost to Prime Minister Narendra Modi's campaign.
The National Statistical Office (NSO) has labeled these figures as preliminary projections for 2023/24. In a reinforcing move, the Reserve Bank of India (RBI) has upgraded its GDP growth forecast lately to 7%, an increase from its previous estimate of 6.5%. This revision strengthens confidence in India's economic trajectory.
Against this backdrop, below we highlight a few reasons for which India ETF investing is worth a watch. ETFs like iShares MSCI India Small-Cap ETF (SMIN - Free Report) , VanEck Digital India ETF (DGIN - Free Report) , Columbia India Consumer ETF (INCO - Free Report) , VanEck India Growth Leaders ETF (GLIN - Free Report) and WisdomTree India Earnings Fund (EPI - Free Report) added in the range of 3.4% to 2% in the past one month (as of Jan 18, 2024) against just 0.3% uptick in the S&P 500.
Emergence of a Global Consumer Market
India's economy is undergoing a significant transformation, shifting towards becoming a consumption-focused economy. Rising disposable incomes are fueling this shift, with around 100 million people projected to reach an annual income exceeding $10,000 by 2027, per Goldman Sachs, as quoted on CNBC.
As incomes rise, there's a growing desire for discretionary spending on items like travel, jewelry, and dining out. This shift is expected to drive significant growth in consumer sectors. India's consumer market is set to become the world's third-largest by 2027, driven by the increasing number of middle- to high-income households, according to Goldman Sachs. A significant portion of India's population, around 33%, falls within the 20 to 33 years age group, making it an attractive market for global firms.
India's Tech and Business Ambitions
India is actively promoting itself as a global hub for technology and business. States like Maharashtra, Tamil Nadu, Telangana, and Karnataka are positioning themselves as tech hubs for manufacturing and AI development, as quoted on CNBC.
Major tech companies, including Apple, Google, and Amazon, have made significant investments in India. Apple, for instance, opened its first store in Mumbai, signaling the importance of the Indian market.
India is actively courting investment from U.S. chipmakers. Companies like AMD and Micron are planning substantial investments in the semiconductor industry in India.
Bullish Economic Growth Prospects
Rahul Bajoria from Barclays Investment Bank credits India's robust growth to effective government economic management, highlighting its resilience despite global economic weaknesses, as quoted on CNBC. S&P Global Ratings projects India as the fastest-growing major economy for the next three years, with expectations of it becoming the world’s third-largest economy by 2030, surpassing Japan and Germany.
Upcoming General Elections: Modi Likely to Win?
General elections are scheduled in India between April and May, where market-friendly Prime Minister Narendra Modi seeks reelection. Modi's tenure has seen significant investments from U.S. tech giants in India.
Sustaining a growth rate above 7% for a third consecutive year, particularly in a global slowdown context, could significantly enhance Modi's chances of securing a third term.
Foreign direct investment in India has surged in recent years, increasing from $36 billion in 2014 to $70.9 billion in 2023. This influx of investment is driven by India's growing reputation as a business-friendly destination.
Bottom Line
India's stability as a democracy, with popular leadership, is seen as a significant advantage. The country's stable political environment and strong economic growth position it favorably on the global stage.
(Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.)