With political stability, low interest rates, weaker dollar and change in China’s position in the post Covid-19 era, India has emerged as the most attractive investment destination

With a stable INR (India’s dollar reserves are at record levels at $580 billion-plus), political stability, low interest rates globally, a weaker dollar and change in China’s position as a favoured global trade partner, bode well for India from a long-term perspective. This has already been seen with 2020 seeing record FII (foreign institutional investment) and FDI flows.

“India’s current fundamentals, especially from a covid perspective, make it one of the most viable investment destinations among emerging markets,” BNP Paribas India Deputy CEO, Sanjay Singh said in an interview with LiveMint.

“With a stable INR (India’s dollar reserves are at record levels at $580 billion-plus), political stability, low interest rates globally, a weaker dollar and change in China’s position as a favoured global trade partner, bode well for India from a long-term perspective. This has already been seen with 2020 seeing record FII (foreign institutional investment) and FDI (foreign direct investment) flows,” he added.

Attributing the contributions of India’s policymakers, Singh said that India remains the investment destination of choice will be to create predictable, consistent and business-friendly policies—right from the ease of doing business to the tax regime.

“Secondly, a significant improvement in infrastructure and lastly, something that we have already seen in small parts, is the simplification of labor laws and incentives for foreign companies willing to commit to India for the long term,” he added.

Asked about the economic recovery after Covid-19 lockdown, Singh said, “The key difference between the shape and pace of economic recoveries in India and the global set-up arises from the (covid-19) caseloads. While the global recovery has stuttered a bit due to a relapse of lockdowns, China and now India have had smoother and sustained recoveries due to the fact that both did not have to enforce stricter restrictions on businesses after exiting the harsh lockdowns at the start.”

Further, he said that the industry was already stalling before the onset of covid and needed a kick-start in some form, which the pandemic has actually provided.