Global brokerage Morgan Stanley is optimistic about Indian economic growth despite the coalition government.
Ridham Desai, managing director of Morgan Stanley India, said that under the leadership of Prime Minister Narendra Modi, the government will implement structural reforms that boost India’s economic growth.
On the coalition government, he said that except in 2014 and 2019, coalition governments have been functioning in India since 1989. This government will last for the next five years.
“I don’t think we’ll see any kind of change in government policy. The government should focus on achieving stability at the macro level and building the supply chain. These are the two things this government will do. India’s growth rate will remain between 7-8 per cent and inflation will remain under control,” he stated.
On the sale of FIIs (foreign institutional investors), Desai said there are two big players in the market. Firstly, domestic investors and, secondly, foreign investors. Currently, domestic investors are buying. In such a situation, foreign investors do not stand a chance. As soon as companies start raising money, foreign investors will be able to enter the market. Purchases by foreign investors will return in the next six months.
Equity mutual fund inflows hit a record high of Rs 34,697 crore in May, up 83.42 per cent from the previous month.
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