Bangalore Investment：The valuation of the financial market is too high, and the difficulty of attracting foreign investment will increase. India’s GDP growth rate will slow down this year？

The valuation of the financial market is too high, and the difficulty of attracting foreign investment will increase. India's GDP growth rate will slow down this year？

[Global Times Reporter Yuan Jirong] India’s "Degan Pioneer" and other media reported on July 23 that the Indian Ministry of Finance issued the "2023-2024 Economic Survey" (hereinafter referred to as the "Economic Survey") report on the 22nd.Looking back at the performance of the Indian economy in the previous fiscal year, but unexpectedly, in the report, the Indian government predicted that India’s 2024-2025 fiscal annual economic growth would slow to 6.5%-7%.In contrast, India’s economic growth rate was as high as 8.2%last year. The Bank of India had previously predicted that the economic growth rate of 2024-2025 was 7.2%, and the average expectations of many economists brought together by Bloomberg were 7%.However, the report of the Ministry of Finance of India believes that the current market’s expected market is high.Bangalore Investment

"There are a lot of speculative activities, it sounds like a casino"

The Economic Survey reports that due to investors’ betting on global economic expansion, the global financial markets of many countries around the world have reached a new high in the past year, including the Indian stock market.Since 2020, the Indian stock market has continued to rise and has continuously refreshing its historical high.According to the British "Financial Times", the benchmark NIFTY 50 index of large Indian companies has doubled in the past 5 years.EssenceAt present, the market value of Indian stocks has exceeded $ 5 trillion.

Some investors and analysts are worried that this increasingly rising enthusiasm is promoting speculative bubbles.The strong demand for Indian stocks may lead to a sharp recovery of the stock price, which scares away a new generation of investors, just like the Internet bubble in Europe at the beginning of this century."There are a lot of speculative activities, it sounds like a casino," said Angravar, chairman of India’s diversified financial service company Motilal Oswal, said that the company has millions of customers across India. "Reorganizing the bullish period.

The family in India told the Global Times reporter, "The business here has not yet improvedAhmedabad Stock. In his spare time, he invested in Indian stocks and instead earned 50 or 60 times." The US financial media "The Street" reported that in 2023The short report of Dengbao pointed out that before the Adida Group was suspected of manipulating the stock price, the stock price of the Indian business giant had soared from the lowest point of the epidemic in the spring of 2020.After the short report was released, the market value of the listed company of Adina Group evaporated at $ 153 billion, revealing many problems in the Indian stock market."In the context of too high financial market valuations, any adjustment may have an impact on family finance and corporate valuations, and a negative impact on growth prospects." The Indian government warned in the "Economic Survey" report.

Personal investment and foreign investment growth slowed down

In addition, the report also predicts that in the case of balanced risks, India’s private investment growth may slow down.The report said: "After experiencing good growth in the past three years, the formation of private capital may become slightly cautious, because it is worried that products imported from countries with excess capacity will become cheaper."

The report also proposes the slowdown of the growth rate of foreign direct investment (FDI) in India, which attributed the reason to the FDI growth environment.India’s net FDI inflow dropped from US $ 42 billion in fiscal 2023 to US $ 26.5 billion in fiscal 2024.According to the report, the high interest rates in developed countries and the increase in financing costs of overseas investors have increased, making India’s increasing difficulty in attracting foreign capital.In addition, the report believes that the emerging economy is reflected in competition through positive industrial policies, and developed economies have adopted considerable subsidy measures to encourage domestic investment.

Researcher Zhen Bo, a researcher at the "South Silk Road Economic and Cultural Research Center" of the Jinjiang College of Sichuan University, said in an interview with the Global Times reporter on the 23rd that India’s internal measures were incomplete and the impact of the epidemic in the past few years wasSome reasons.In addition, after the large -scale infrastructure investment from India has decreased significantly, other countries’ interest in Indian investment is not high, which has also led to the current situation.

Call for more Indian FDI

India’s "TimeSnown" website reports that the "Economic Survey" report urges India to increase FDI from India to strengthen local manufacturing and exports.India has become India’s largest imported partner.From 2023 to 2024, the trade volume of the two countries reached 118.4 billion US dollars, surpassing the trade volume between India and the United States, and the trade deficit between India and India was continuously expanding.Expanding Indian investment can enhance India’s participation in global supply chains and increase its export performance.

In the latest federal budget released on the 23rd, Indian Finance Minister Sitraman proposes to simplify the specifications of FDI and overseas investment to attract foreign investment and reduce corporate taxes from 40%to 35%to increase the interest of foreign investors.

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