India’s current political climate is vibrant, its consumption on the rise; it is a huge country distinguished by its countless contradictions: after a recent trip to Asia, Kairos analyst Moreno Tatangelo focuses on India’s economic and financial context under Modi, who, enjoying a broad electoral consensus, has undertaken ambitious reforms.
New Delhi has brought about so much change in 2014… what do financial operators think about it?
“The managers we spoke with remain extremely optimistic about the future of the Indian stock market, which continues to set record highs. And not only that, after years of having to deal with racing inflation and both fiscal and current trade deficits, the measures that the central bank’s new governor introduced in late 2013 have laid the foundation for macroeconomic stabilization. Modi’s win could not have come at a better time. The economy is at the start of new cycle of expansion, which will be amplified by the structural reforms that the new administration has already launched.”
What are the biggest changes in the political scenario?
“In the past few months, the government has implemented different measures, like eliminating diesel subsidies and labor market reform, particularly important for the development of the manufacturing industry. But in recent days, Congress, the main opposition party, announced that it will back the government on the law abolishing a series of local taxes, which will be replaced with a single tax on goods and services, facilitating the economic integration of India’s individual states and encouraging the country’s growth.”