Home / Knowledge / News / Textiles / HSBC backs India to drive global growth
HSBC backs India to drive global growth
14
Jun '16
An HSBC report has described India as the “obvious candidate” to push global growth amid a stubborn slowdown but said it will need sustained GDP expansion to reach, by 2025, the share of world GDP that China had at the height of its boom in 2005.

“If the West is not bouncing back to its former strength any time soon, where will growth come from? India is the obvious candidate,” HSBC economists said in a note. China as the economic engine has “begun to sputter” and India is the only other country with over a billion plus people and also grew “a tad faster” than its northern neighbour in the last year.

On a sobering note, it said that it is clear that India’s economy is not large enough to make up for a slowdown in mainland China but added that it holds great potential.

“India may struggle to attain, for now, the growth rates China achieved at the height of its boom. Still, don’t count the country out just yet: assuming things keep ticking as long as they have, by the middle of the next decade India’s economy will account for the same world share as China did in 2005, the year when the mainland really started to make itself felt globally,” it said.

The HSBC report said it is “tough” for India to match China’s boom-time growth rates, and recommended that the country will have to push its national investment rate up to achieve higher growth.

“China’s investment rate has always been higher than India’s (although by a relatively narrow margin in the late 2000s). To achieve China’s growth rate of the last decade, India would have to boost its investment rate by 10 per cent points or so of GDP,” it said, adding that this is not impossible.

It termed this as a “momentous shift” which will be taking place, and added that this is going by the share of world GDP in dollar terms. India will equal to China’s 4.9 per cent share of world GDP in 2005 by the middle of next decade, it said, adding that if the country grows faster, the date can be advanced.

The expectation comes days after official data suggested the Indian GDP grew 7.6 per cent in fiscal year 2015-16 on the back of a faster 7. 9 per cent growth in the last quarter.

The presence of a pro-growth, reform oriented regime at the Centre, along with fundamental factors like favourable demographics which make it among the youngest nation in the world, and large consumer base, is making analysts more confident about the India story, HSBC said.

China, which embarked on its reforms from the early 1980s, grew at double digits to lead the global growth on its shoulders after the post-Lehman crisis. (SH)

Fibre2Fashion News Desk – India

Must ReadView All

Courtesy: AWI

Textiles | On 20th Jan 2017

Australian wool EMI at highest ever level in Au$ terms

The Eastern Market Indicator (EMI) managed to forge ahead by a...

Textiles | On 20th Jan 2017

Bangladesh could earn $60 billion in exports by 2021

Bangladesh is expected to earn over $60 billion in exports by the...

Textiles | On 20th Jan 2017

Xeros to focus on textile sector to develop technology

Xeros technology group plc, the developer and provider of patented...

Interviews View All

Amardeep Singh
Orient Craft

'In export markets, the trend in terms of embroidery, is towards matte...

Ghanshyam Ghoghari
Kimora Fashion

Bridalwear is not about reds and whites anymore

Yash Maniyar
Rekha Maniyar

Indian fashion market is growing at a staggering rate

Suresh Patel
Sidwin Fabric

Sidwin Fabric is a manufacturer and exporter of polypropylene textiles and ...

Paolo Ocleppo
Sandvik Hyperion

Paolo Ocleppo, Rotary Cutting Segment manager, Sandvik Hyperion discusses...

Urs Stalder
Sanitized AG

Urs Stalder, CEO, Sanitized AG, talks about the increasing use of hygiene...

Igor Chapurin
Chapurin

"Now we can see the Russian trend in international fashion. And Russian...

Jay Ramrakhiani
Occasions Elegance Wear

It is believed that by early 19th century, Varanasi weavers had moved away ...

Prathyusha Garimella
Prathyusha Garimella

Hyderabad-based designer Prathyusha Garimella is known for blending...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH
January 2017

January 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


eNEWS
Insights
Subscribe today and get the latest News update in your mail box.
Advanced Search