oppn parties In A First, Chinese Bank Starts India-Dedicated Fund

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  • Citizenship Bill to be tabled in the Lok Sabha today. Heated debate likely
  • Domestic tourism in Kashmir slumps by 87% in August-November period
  • Prime Minister Modi says police must make women feel safe
  • West Indies beat India by 8 wickets in the second T20 at Thiruvananthpuram
  • Rahul Gandhi says the NDA government kept Chidambaram in jail for so many days in order to take revenge
  • Kohli reclaims the top spot in ICC rankings from Steve Smith
  • Cabinet clears the Citizenship Bill. It will be placed in the Lok Sabha in a day or two
  • Hindu Jagran Manch members clash with the police in Kolkata after being refused permission to take out a rally
  • West Bengal Governor Jagdeep Dhankar says important files were sent late to him and his delay in signing them draws criticism from the TMC. It also brings the state assembly to a halt
  • 92,000 BSNL & MTNL employees apply for early retirement taking advantage of the new government offer. It will result in an annual savings of Rs 8.700 cr for the merged entity
  • Dengue deaths multiply in Kolkata even as the CM, Mamata Banerjee, asks the opposition not to politicize the matter
  • Government orders inquiry into the breach of security at Priyanka Vadra's house
  • Chennai-based engineer Shanmuga Subramanian helps Nasa find the pieces of Vikram lander on the Moon's surface
  • New Maharashtra CM Uddhav Thackeray says his administration will take back cases against Dalits and activists in the Bhima Koregaon case
  • Dhawan calls his dismissal "nonsense"
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In A First, Chinese Bank Starts India-Dedicated Fund

By Yogendra
First publised on 2018-05-16 12:15:28

About the Author

Sunil Garodia Yogendra is undecided whether he wants to be a writer. So he writes to see if he can be a writer. Ha Ha
As a welcome acknowledgement of the growing potential and excellent future prospects of Indian industry, the state-run Chinese bank, The Industrial and Commercial Bank of China, has started an India-dedicated investment fund. Although there is nothing surprising about an investment bank trying to channel funds in an area it thinks will offer lucrative returns to investors, what is surprising is that a Chinese bank is doing so. This is a first, for China till now always tried to downplay the Indian industry which was seen as competition. The fund is named the Industrial and Commercial Bank Credit Suisse India Market Fund and its corpus will be invested “in exchange-traded funds listed on more than 20 exchanges in Europe and the US that are based on the Indian market." The fund has listed priority sectors for investment and the financial sector will get the bulk of its investments followed by the information technology industry.

It is even more surprising that the pitch for the fund talks about the Indian economy in glowing terms. One can of course say that it is just sales pitch but coming from the Chinese it is no small praise. The Chinese have always been disdainful of the inefficiency and red tape that rules economic activity in India. They also scoff at India’s focus on small and medium enterprises and point to the success of their huge factories churning out products by the millions to take advantage of economies of scale. Although they secretly admire India for the excellent quality of its engineering products, the work being done in its IT sector and the reach and diversity of its financial sector, the Chinese are loath to admit it in public. This is the first time they have put this on paper.

The write-up pitching the fund says that "across the overseas market, India, as the second largest emerging market economy, is entering the golden age of economic take-off, and has become an area where international and domestic capitals are competing to pursue," and adds that "the larger marginal improvement formed by various structural reforms led by Modi government is expected to unleash India's abundant demographic dividend." Quoting figures from the IMF, it goes on to say that India’s economy will continue to lead the global economy for a long time to come.

This, coupled with the recent record breaking Walmart-Flipkart deal, is likely to boost some sectors of the Indian economy further. The onus is now upon the government to identify bottlenecks and introduce further reforms, especially in the financial and retail sector, to attract FDI. People abroad have funds to invest. If India can capitalize on its growing potential by easing norms, it will be a winner. Otherwise, there are other emerging markets waiting in the wings.