India's economy has seen an unprecedented surge in economic activity with a staggering $8 trillion being invested in the last decade, which comprises more than half of the total $ 14 trillion invested in the country since Independence, according to a new report.
The report by the financial services leader Motilal Oswal also noted that the acceleration is expected to continue, with projections indicating that India will invest an additional $8 trillion in the next five years.
It pointed out that the investment-to-GDP ratio, which had been low since 2011, is now recovering due to post-COVID recovery efforts and increased government expenditure on big ticket infrastructure projects.
The growing size of India's annual investments reflects a shift towards sustained economic growth and enhanced global competitiveness.
The report highlighted that India's stock market has been another cornerstone of economic strength, delivering positive returns in 26 of the past 33 years despite periodic downturns.
It stated that the "10–20 per cent temporary drawdown is almost a given every year." It also advises investors to avoid panic selling during market downturns, urging a long-term perspective to capitalise on recovery trends.
With robust investment momentum and resilient markets, India is on track to solidify its position as a global economic leader. As the investment base grows and the GDP ratio improves, the country is poised for sustained growth and enhanced global competitiveness, the report added.
India has become a market that you can’t ignore, pushed on by government reforms and a booming tech industry.
Five years ago, India’s weighting on the Emerging Market index was 9 per cent. It is now over 20 per cent.
The inclusion in June 2024 of Indian government bonds into the J.P. Morgan Global Bond Index-Emerging Markets indices for the first time also sets the stage for billions of dollars more to flow into India.
India’s inclusion in the prestigious FTSE Russell’s Emerging Market government bond index in September next year has also been lauded by the investor community.
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