NAMO factor: Indian industry, FII’s upbeat on Indian economy prospects.


Financial Institutional Investors (FIIs) and Indian industry are upbeat on economy’s prospects under new government in India headed by Narendra Modi.
A visiting delegation of Confederation of Indian Industry (CII) to USA said that there is growing sense of optimism amongst both the public and industry in India following the recent watershed election results which brought the BJP to power with a landslide victory. A LinkedIn survey of 13,000 business leaders across 15 countries found India was among the few nations that showed a significant increase in confidence towards their domestic economies.
In the April-June period, 90 per cent business leaders surveyed by LinkedIn were expecting improvement in the country’s economy compared to 53 per cent in the January-March quarter this year.
The Bharatiya Janata Party’s (BJP) pro-business and pro-job creation agenda and its extremely strong showing in India’s 2014 general election in May is a likely spark for that impressive increase in economic confidence.
The equity markets have also cheered the victory of BJP and betting big on the government’s reform agenda, overseas investors have poured more than US $ 5 bn in the Indian market so far this month taking the total inflow to over US $25 bn since January.Net investments by foreign investors in the equity market were USD 2.2 billion (Rs. 13,166 crore) from July 1-25, while they amounted to USD 3 billion (Rs. 17,829) in the debt market, taking the total to USD 5.2 billion (Rs. 30,995 crore), as per the latest data.
At a recent panel discussion jointly hosted by CII and the Carnegie Endowment for International Peace (CEIP), India’s CEOs emphasized the tremendous mood swing and positivity in India since the installation of the new government.
Mr. Ajay Shriram, CII President described the unique nature of the recent elections, in which the BJP came to power solely on the campaign promise of growth and development, which speaks to the aspirations of India’s young people. Pointing to the visionary Union Budget 2014-15, Mr. Shriram commended the new government for moving very actively to ease and facilitate the way business is done in India. “Success in India will come with leadership, mindset change, philosophy and action.” said Mr. Shriram. Mr. Chandrajit Banerjee, Director General, CII also appreciated the government’s vision and receptivity to new ideas and thoughts, especially from industry.
Meanwhile, analysts are optimistic that the buoyancy in equity markets will continue on a slew of measures announced by the government. The Cabinet has given go-ahead to hiking the foreign direct investment (FDI) cap insurance to 49%, paving the way for infusion of Rs 25,000 cr foreign funds.
Also, the government may soon take a decision on easing FDI in railways and defence sectors.

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