Indian Market Scenario 1: Would you Invest in India under these circumstances?

Currently, there are lots of negatives news, events and circumstances related to Indian Market such as

 India’s Rating

  • India has lowest Investment grade rating by rating agencies (BBB-). One more downgrade will change its status to non-investment grade i.e. Junk
  • S&P has negative outlook on India i.e. there is higher probability of downgrade than upgrade
  • Fitch recently change the outlook on India from stable to Negative

 Indian Economy

  • RBI keeping Interest rate very high (highest amongst emerging markets)
  • Inflation is very high due to supply related issues
  • Decreasing GDP growth rate
  • Increasing Budget deficit
  • Deteriorating foreign exchange reserves
  • Devaluation of Rupee from 49/$ to 56/$ in 5 months

 Indian Government

  • Political deadlock/problems related to coalition government
  • Corruption
  • Policy deadlock
    • Delay in implementation of Direct Tax Code (DTC), Goods and Service Tax (GST), Company Laws Bill, International Financial Reporting Standards (IFRS), etc.
    • Uncertainty about GAAR provisions
    • Uncertainly about review of DTAA with Mauritius and other tax haven countries

 International

  • Greece, Spain and other PIGS countries debt problem and probability of default
  • Eurozone crisis due to inter linking of debt
  • Struggling developed economies (including USA) and declining growth rate in emerging countries (including China)
  • Devaluation of currency of emerging economies (Brazil’s currency depreciation is worse than Indian Rupee)

And more………

So, what you think, Would you invest in India under these circumstances????

 

Category: General, Investments in India, NRI Investments, Wealth Management Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,
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