India Risk Assessment
I recently read a coface report on country risks and this is what it has to say about India…
Strengths
1. Very substantial market potential with a rapidly developing middle class.
2. Definite competitive advantage in sectors like computers, outsourcing, steel, pharma & textiles
3. Dynamic local companies with international scope
4. Manageable foreign debt and ample foreign currency reserves
5. Progressive and continuous economic liberalization since ‘91
6. Start on consolidation of public sector finances and banking sector
Weakness
1. Very unevenly distributed growth that could provoke severe social discontent.
2. Troubling situation of public sector finances, with public debt unsustainable in the long-term
3. Poor financial intermediation, deficiencies in infrastructure and business / legal environment.
4. Despite progress, Kashmir issue is still an element of uncertainty.
Risk assessment
Short-term : A3 (adverse political or economic circumstances may lead to a worsening payment record that is already lower than the previous categories, although the probability of a payment default is still low)
Medium-term : Quite low risk
Strengths
1. Very substantial market potential with a rapidly developing middle class.
2. Definite competitive advantage in sectors like computers, outsourcing, steel, pharma & textiles
3. Dynamic local companies with international scope
4. Manageable foreign debt and ample foreign currency reserves
5. Progressive and continuous economic liberalization since ‘91
6. Start on consolidation of public sector finances and banking sector
Weakness
1. Very unevenly distributed growth that could provoke severe social discontent.
2. Troubling situation of public sector finances, with public debt unsustainable in the long-term
3. Poor financial intermediation, deficiencies in infrastructure and business / legal environment.
4. Despite progress, Kashmir issue is still an element of uncertainty.
Risk assessment
Short-term : A3 (adverse political or economic circumstances may lead to a worsening payment record that is already lower than the previous categories, although the probability of a payment default is still low)
Medium-term : Quite low risk
Sounds VERY promising...right? Let's hope India has a bright future in terms of political & economic performance.
posted by Sriram at 8:09 AM
1 Comments:
India’s strength is foreign investors strength in as much as our weakness too. No doubt Middle class in India is rapidly developing- How & Why? s. Because upper middle class is sliding down to middle class. Of the commodities referred textiles may be removed, as we no longer hold competitive advantage in the International market. No doubt number of dynamic companies exist in our country with international SCOPE but without any HOPE (The real scenario) the reasons being government’s squeezing, unadaptable and unacceptable tax policies coupled with political gimmicks. No use of economic liberalization being continuous and progressive it has to be well balanced which is NOT AT THE MOMENT nor will attain in the near future. Public sector finance troubling situation is not some thing new to India, it has been a part of our country, brilliant and intelligent Finance Ministers have faced this problem so nothing to mention about mediocre Fin. Minster. Consolidation of Public sector finance does it mean selling of gove owned stake to private parties? And to privatize the public sector banks. It will be most ideal for a country like our’s to hand over the Ministry of Finance to be totally managed privately rather than keeping it with government to be managed and shattered by a bunch of buffoons. Kashmir issue in no way should come in the way of economic growth and development as this issue exists from pre-independence days and this problem will continue to exist for the existence of political competitors.
Now having assessed India Risk, Government should analyze at this stage to manage the risk and prevent the risk from growing.
India can hope to have a bright future only when our political system changes and our politicians turn transparent, honest, loyal and sincere. Just because we lacked in these areas NASA and Silicon Valley (just to mention few) are located in USA, instead of being in INDIA with Indian brains behind its inception and growth.
RICH INDIA with poor governance and systems & RICH USA with RICH Indians behind every success and growth.
6:35 PM
Post a Comment
<< Home