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

ASEAN ministers sign agreement on e-commerce

Apparel/Garments | On 17th Nov 2018

ASEAN ministers sign agreement on e-commerce

Member countries of the Association of Southeast Asian Nations...

UK Govt, fashion retailers sign agreement to fight slavery

Fashion | On 17th Nov 2018

UK Govt, fashion retailers sign agreement to fight slavery

John Lewis, M&S, New Look, NEXT, River Island and Shop Direct...

CNTAC delegation from China visits Pakistan

Textiles | On 17th Nov 2018

CNTAC delegation from China visits Pakistan

Chinese investors have expressed a desire to enter into joint...

Interviews View All

Cyril Pereira, Reed Exhibitions India, organiser of Asian Machine Tool Exhibition 2016

Cyril Pereira
Reed Exhibitions India, organiser of Asian Machine Tool Exhibition 2016

'Major problem in the textile machinery manufacturing industry is the lack ...

Stefan Warnaar, Peak to Plateau

Stefan Warnaar
Peak to Plateau

People are willing to pay for quality and performance

Ajay Ghariwala, Luthra Group

Ajay Ghariwala
Luthra Group

We are ready to adopt or follow every opportunity

Maya Simova,

Maya Simova

Inter Expo and Congress Center (IEC) is a prominent exhibition centre in...

Carolin Russ,

Carolin Russ

Weko, Weitmann & Konrad GmbH & Co KG, based in south Germany, is...

Urmil Arya,

Urmil Arya

Sushila International, a well established textile organisation established ...

Dave Rousse, INDA

Dave Rousse
INDA

INDA, the Association of the Nonwoven Fabrics Industry, serves hundreds of ...

Andreas Lukas, Andritz Nonwoven

Andreas Lukas
Andritz Nonwoven

With forces in engineering and process development, Andritz Nonwoven...

Pierre Wiertz, EDANA

Pierre Wiertz
EDANA

Pierre Wiertz talks about the vast world of sustainable nonwovens and...

Divvya and Nidhhi Gambhir, Walnut

Divvya and Nidhhi Gambhir
Walnut

<b>Divvya and Nidhhi Gambhir</b> started their career with the launch of...

Amiben Shroff, Shrujan

Amiben Shroff
Shrujan

From its modest beginning in the late 1960s, Shrujan has grown into a...

Robert Brunner, Devereux

Robert Brunner
Devereux

Golfwear and menswear brand Devereux is set for greener pastures. Robert...

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

Leave your Comments


November 2018

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

news category


Related Categories:

Advanced Search