Best of the Week
Most Popular
1. TESLA! Cathy Wood ARK Funds Bubble BURSTS! - 12th May 21
2.Stock Market Entering Early Summer Correction Trend Forecast - 10th May 21
3.GOLD GDX, HUI Stocks - Will Paradise Turn into a Dystopia? - 11th May 21
4.Crypto Bubble Bursts! Nicehash Suspends Coinbase Withdrawals, Bitcoin, Ethereum Bear Market Begins - 16th May 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.Cathy Wood Ark Invest Funds Bubble BURSTS! ARKK, ARKG, Tesla Entering Severe Bear Market - 13th May 21
7.Stock Market - Should You Be In Cash Right Now? - 17th May 21
8.Gold to Benefit from Mounting US Debt Pile - 14th May 21
9.Coronavius Covid-19 in Italy in August 2019! - 13th May 21
10.How to Invest in HIGH RISK Tech Stocks for 2021 and Beyond - Part 2 of 2 - 18th May 21
Last 7 days
UK Energy Firms Scamming Customers Out of Their Best Fixed Rate Gas Tariffs - 23rd Sep 21
Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Should School Children be Jabbed with Pfizer Covid-19 Vaccine To Foster Herd Immunity? - UK - 23rd Sep 21
HOW TO SAVE MONEY ON CAR INSURANCE - 23rd Sep 21
Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
Trading Crude Oil ETFs in Foreign Currencies: What to Focus On - 22nd Sep 21
URGENT - Crypto-trader event - 'Bitcoin... back to $65,000?' - 22nd Sep 21
Stock Market Time to Buy the Dip? - 22nd Sep 21
US Dollar Bears Are Fresh Out of Honey Pots - 22nd Sep 21
MetaTrader 5 Features Every Trader Should Know - 22nd Sep 21
Evergrande China's Lehman's Moment, Tip of the Ice Berg in Financial Crisis 2.0 - 21st Sep 21
The Fed Is Playing The Biggest Game Of Chicken In History - 21st Sep 21
Focus on Stock Market Short-term Cycle - 21st Sep 21
Lands End Cornwall In VR360 - UK Holidays, Staycations - 21st Sep 21
Stock Market FOMO Hits September CRASH Brick Wall - Dow Trend Forecast 2021 Review - 20th Sep 21
Two Huge, Overlooked Drains on Global Silver Supplies - 20th Sep 21
Gold gets hammered but Copper fails to seize the moment - 20th Sep 21
New arms race and nuclear risks could spell End to the Asian Century - 20th Sep 21
Stock Market FOMO Hits September Brick Wall - Dow Trend Forecast 2021 Review - 19th Sep 21
Dow Forecasting Neural Nets, Crossing the Rubicon With Three High Risk Chinese Tech Stocks - 18th Sep 21
If Post-1971 Monetary System Is Bad, Why Isn’t Gold Higher? - 18th Sep 21
Stock Market Shaking Off the Taper Blues - 18th Sep 21
So... This Happened! One Crypto Goes From "Little-Known" -to- "Top 10" in 6 Weeks - 18th Sep 21
Why a Financial Markets "Panic" May Be Just Around the Corner - 18th Sep 21
An Update on the End of College… and a New Way to Profit - 16th Sep 21
What Kind of Support and Services Can Your Accountant Provide? Your Main Questions Answered - 16th Sep 21
Consistent performance makes waste a good place to buy stocks - 16th Sep 21
Dow Stock Market Trend Forecasting Neural Nets Pattern Recognition - 15th Sep 21
Eurozone Impact on Gold: The ECB and the Phantom Taper - 15th Sep 21
Fed To Taper into Weakening Economy - 15th Sep 21
Gold Miners: Last of the Summer Wine - 15th Sep 21
How does product development affect a company’s market value? - 15th Sep 21
Types of Investment Property to Become Familiar with - 15th Sep 21
Is This the "Kiss of Death" for the Stocks Bull Market? - 14th Sep 21
Where Are the Stock Market Fireworks? - 14th Sep 21
Play-To-Earn Cryptocurrency Games Gain More and Is Set to Expand - 14th Sep 21
The CashFX TAP Platform - Catering to Bull Investors and Bear Investors Alike - 14th Sep 21
Why every serious investor should be focused on blockchain technology - 13th Sep 21
SPX Base Projection Reached – End of the Line? - 13th Sep 21
There are diverse ways to finance the purchase of a car - 13th Sep 21
6 Tips For Wise Investment - 13th Sep 21 - Mark_Adan

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gujarat, India Like Investing in China… In 1980

Stock-Markets / India Jun 02, 2014 - 02:10 PM GMT

By: Money_Morning

Stock-Markets

Peter Krauth writes: Hardly anyone would argue that China isn't an economic miracle.

Over the last 20 years, its 1.3 billion people have propelled the Chinese economy into the world's No. 2 spot.

But two decades of blistering 10% annual growth have moderated to 7%.


However, a potential sea change is underway in its southern neighbor, India.

With a new, impressive prime minister, and a burgeoning consumer population, they're setting up as the next economic miracle...

The Barriers to Growth Are Tumbling Down

India's 1.2 billion people have just held the world's biggest democratic election in history.

With 814 million eligible voters, it took over a month to complete.

And with a 66.38% turnout, the highest ever in Indian general elections, people wanted to be heard.

That's because after decades of crippling bureaucracy and deep-rooted corruption, Indians have had enough.

In a country where government boondoggles are rampant, it's estimated some $240 billion of public works projects are red-taped and unable to move forward.

In one instance, the federal government investigated illegal and unreported iron ore mining over the four years spanning from 2006 to 2010. As a result, numerous high-ranking officials were jailed after more than 110 billion short tons of iron ore may have been mined without permits or paying royalties.

Since then, the Supreme Court of India has banned mining in some of the involved areas, with the Federation of Indian Mineral Industries indicating that iron ore exports have fallen 70% since the ban in Karnataka and Goa states.

Sadly, most of India's infrastructure is appalling: power, transportation, information networks, and water, where they exist, are often subpar and overloaded.

But that's not the case everywhere.

Take Gujarat state, for example...

The Economist said Gujarat is India's Guangdong - an industrial powerhouse province in China - and that "so many things work properly in Gujarat that it hardly feels like India."

Gujarat is so industrious that it's responsible for 25% of national exports, while home to just 5% of India's population.

Most impressive, however, is the man who was instrumental to the state's success.

Narendra Modi was Chief Minister of Gujarat from 2001 to 2014. During his tenure, the last decade saw Gujarat's economy grow at over 10% annually, while India's grew at just under 8%. Modi brought electricity to all 60 million of its residents, the first Indian state to achieve this milestone.

And Modi also happens to be India's newly elected prime minister.

Modi's reputation, it's fair to say, is why his party won the election. They even locked up seats to spare with India's most decisive vote in three decades.

According to the BBC's Andrew North, "The scale of victory is truly gigantic in India's fractured polity where no party has managed to get a simple majority since Congress in 1984 won 415 seats riding on a sympathy wave after the assassination of Indira Gandhi."

On his first day in office, Modi clearly stated that his office would "call the shots" on all important policy issues, reversing the structure that developed over the last decade, leading to massive inaction.

The Best Direct Play on India

Modi may be a person of ambition, but, more importantly, his track record demonstrates he's one of action.

His goal is to bring electricity to all of India by 2019 which, to this day, still counts 400 million citizens without.

Infrastructure build-out and improvements, deregulation, and foreign investment are all top priorities for the new administration. Modi has ambitious plans for his country.

That's going to require massive amounts of resources like base metals and energy. And with China's growth moderating, India could go a long way to compensate for demand.

And it appears investors have taken notice of India's new way forward.

Year to date, along with a shot in the arm since the start of the election, India's stock market has gained 17%.

But I believe there's much more to come.

A straightforward way to play India's secular bull is through the iShares India 50 ETF (Nasdaq: INDY). The fund tracks the performance of India's 50 largest public companies. It's up by 26% year to date, but still trades at a very reasonable P/E of 15 while yielding 0.7%. And there should be a lot more upside to come.

Modi's campaign slogan was "Good Times Ahead."

Considering his pro-business stance, propensity for lean government, and most of all his track record, it will also be "Great Profits Ahead."

Source : http://moneymorning.com/2014/06/02/this-is-like-investing-in-china-in-1980/

Money Morning/The Money Map Report

©2014 Monument Street Publishing. All Rights Reserved. Protected by copyright laws of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), of content from this website, in whole or in part, is strictly prohibited without the express written permission of Monument Street Publishing. 105 West Monument Street, Baltimore MD 21201, Email: customerservice@moneymorning.com

Disclaimer: Nothing published by Money Morning should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investent advice. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication, or after the mailing of printed-only publication prior to following an initial recommendation. Any investments recommended by Money Morning should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.

Money Morning Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in