The India Economic Summit 2014: Good and bad news for investors (Part 1 of 14)

What was the summit about and why should investors care?

By David Ashworth Dec 4, 2014 11:19 am EDT

The theme

The theme of the India Economic Summit 2014, organized by the World Economic Forum (or WEF) along with the Confederation of Indian Industry (or CII), was “Redefining Public-Private Cooperation for a New Beginning.”

Viraj Mehta, director in charge of India and South Asia at the WEF, put forth the idea behind the summit. According to him, India’s leaders’ ability to make bold decisions is crucial to the nation’s progress, and the event aimed to offer a setting where such decisions can be set in motion. The summit saw participation from politicians, business leaders, and representatives from the social sector.

The main agenda points

The agenda featured several topics, including food security, health, energy, skills and employment, transparency, growth outlook, infrastructure, delivering digital India, financial inclusion and manufacturing.

India open for business

The central question in this series is which of the agenda points mattered and can affect your India investment? The world’s largest democracy, albeit a bit late, is making a comeback on investors’ radars. This regenerated interest is primarily because of the change in India’s central government in mid-2014. Equities reacted favorably to this change. The above graph shows the year-to-date (or YTD) returns of some India-focused ETFs.

The current Prime Minister, Narendra Modi, was seen as business-friendly from the time he was announced as the prime-ministerial candidate by the National Democratic Alliance (or NDA). This image of his took hold because of the economic prosperity that he brought to the state of Gujarat during his tenure as its Chief Minister from 2001 until 2014.

For investors of India-focused ETFs like the WisdomTree India Earnings Fund (EPI ), the PowerShares India Portfolio (PIN ), and US-listed India ADRs like ICICI Bank (IBN ), Infosys (INFY), and Tata Motors (TTM ), the forum provided an opportunity to get an insight into what leaders from across the spectrum are thinking about India. The application of their thinking, which will be put under close scrutiny, can be crucial to how your India investments behave.

If you want to know more about economic conditions in India, you can read this post on India’s economy.

Coming up

The series has been divided into factors that are working as attractors, detractors, and facilitators for India, and how they affect your India investment.