Articles 1 to 10 of 64
Will Rising Inflation Deflate India's Economic Recovery?
Like many countries that have relied on monetary and fiscal relief policies to ride out the financial crisis, India knows it will one day have to wind down its stimulus measures or face a steep inflationary spiral that could derail economic growth. Because the country suffered less than most economies during the global downturn, it looks to be recovering quickly, and decisions regarding a stimulus exit strategy have become all the more critical. The governor of the Reserve Bank of India, D. Subbarao, has predicted that inflation will be 6.5% at the end of March 2010 -- more than the policy comfort zone of 4% to 5%. Experts weigh in on what rising inflation could mean for the Indian economy
Indian Companies Ride New Waves of Fundraising
Despite the worldwide credit squeeze, which has impacted corporate India as well as other markets, Indian companies are once again finding it easy to raise funds. While some firms are turning to asset sales and instruments such as American and Global Depository Receipts to shore themselves up financially, others are joining the line for what looks like a new wave of Independent Public Offerings (IPOs). The market is responding to their efforts: In late June, an IPO by Mahindra Holidays and Resorts was oversubscribed 9.8 times. Meanwhile, a possible tsunami of debt threatens to drown any momentum in the private sector -- the government's projected fiscal deficit of 6.8% of GDP in 2009-10.
What's Behind Rural India's Budget Bonanza?
India's rural economy has received more resource commitments in the government's latest budget proposals than in recent years. While Wharton faculty and other experts welcome the government's approach of being inclusive, critics claim the government isn't walking its talk. India Knowledge@Wharton interviews economists and other experts to help explain what the new budget will mean for thousands of India's villages.
Budget 2009 Arrives … Not with a Bang But a Whimper
After the Congress-led government was voted back to power in the recent general elections, hopes ran high for the Union budget presented on July 6 by Finance Minister Pranab Mukherjee. As it turned out, the budget came as a shock to almost everybody, not for what it did contain but for what it didn't. While rural India did get greater attention, the budget lacked other major reform or policy initiatives. Wharton faculty and other experts note, however, that reforms might follow later.
Providence Equity's Gaurav Sharma: 'Private Equity Is Now a More Mature Market'
In the world of private equity, Providence Equity Partners is a specialist. The firm, whose headquarters are in Providence, R.I., specializes in deals involving media, entertainment, information and communications companies. In 2007, Providence Equity opened its New Delhi office, headed by Biswajit (Bis) Subramanian, who had earlier been a managing director in the firm's London office. By mid 2008, Providence Equity had invested more than US$1 billion in Idea Cellular, which, according to media reports, was among the largest private equity investments in India's telecom sector. What is Providence Equity Partners' strategy for India? How has it changed as a result of the global financial crisis? In an interview with India Knowledge@Wharton, Gaurav Sharma, who works with Subramanian on defining and executing Providence Equity Partners' India strategy, discusses those questions and more.
As Foreign Banks Detour, Public Banks Forge Ahead
Has a new golden age dawned for India's public sector banks? In the past, these institutions have been regarded as laggards compared with private sector or foreign banks. But as foreign banks reel from the global financial crisis, public sector banks -- which have largely avoided high-risk investments involving subprime mortgages -- have emerged as models of stability and fiscal responsibility. India Knowledge@Wharton spoke with experts about whether public sector banks now hold a decisive advantage over their global rivals, or whether, as one observer notes, it is a case of "satisfactory underperformance."
India's New Stock Market Story and Its 'Next Trillion Dollar Opportunity'
Soya processing and leasing companies caught the Indian stock markets' imagination in the early 1990s. Then came the Y2K rush and the dot-com boom in the late 1990s, followed by yet another binge on IT software stocks. According to Raamdeo Agrawal, co-founder of Motilal Oswal Securities, the stock markets "always come up with a story every four or five years." Agrawal and other investment experts discussed India's capital markets during the recent Wharton India Economic Forum in Philadelphia. While declining foreign investments may temporarily threaten economic growth, many of the speakers said they remained bullish on India, especially for the long term.
Post-crash Scenarios for Commodities and 'Turbo-coupled' Emerging Markets
According to Ignatius Chithelen, managing partner of Banyan Tree Capital Management, an investment firm in New York City, emerging markets are not de-coupled but rather "turbo-coupled" to developed markets. In this opinion piece, Chithelen describes what he sees on the horizon for emerging markets and for commodities prices in the wake of the global economic crisis. Among his predictions: China will likely emerge as the big winner from the current worldwide recession, and Mexico's recent hedging of its oil exports will lead to a cap on commodities prices over the short to medium term.
Scandal at Satyam: Truth, Lies and Corporate Governance
When terrorists attacked Mumbai last November, the media called it "India's 9/11." That tragedy has been succeeded by another that has been dubbed "India's Enron." In one of the biggest frauds in India's corporate history, B. Ramalinga Raju, founder and CEO of Satyam Computers, India's fourth-largest IT services firm, announced on January 7 that his company had been falsifying its accounts for years, overstating revenues and inflating profits by $1 billion. According to experts from Wharton and elsewhere, the Satyam debacle will have an enormous impact on India's business scene over the coming months. The most significant questions, however, will be asked about corporate governance in India, and whether other companies could follow Satyam's Raju in revealing skeletons in their own closets.
Global Economic Forecast for 2009: Will Demand for Good News Outpace Supply?
After a year of financial shock and sharp economic loss, 2009 is likely to be extremely difficult for the global economy, with investors, business leaders and policymakers struggling to find signs of recovery. Wharton faculty and other experts interviewed by the Knowledge@Wharton Network discuss the outlook for India, the U.S., Europe, Latin America, China and Japan.
