Could today’s India outshine yesterday’s China?
By Kristen McGachey, 17 Aug 17
Though it might be tempting to view today’s India as yesterday’s China, Rathbones’ head of asset allocation Ed Smith thinks the region’s growth prospects could be even greater based on five key indicators.
This last key data point is the area where today’s India noticeably outshines an early 2000’s China.
“India’s level of household consumption is higher today than China’s was 17 years ago,” Smith pointed out, but crucially “it could still increase by trillions over the next 10 years”.
Although the region is still lagging on the virtual shopping front, with over one broadband subscription per 100 people versus China’s 20 in 2015, he thinks there is plenty of scope for financial deepening, aided by recent banking and monetary reform.
However, he does note that household leverage in India at 27% is higher currently than China’s was back in 2000 at 11%.
