India of My Dreams

As India’s economy continues to grow at rapid pace, we believe our country will literally lift itself from third world to first world, and become a world superpower once again…

We believe, India is on the verge of this massive transformation. This big change is aided by an extremely rare, once-in-2000 years economic phenomenon we may call it the Rebirth.

We Indians have never seen anything like the Rebirth in the past. And I doubt we’ll see anything of this scale in the future again. These changes will be permanent. They will have a huge positive impact on Indian Economy. 

And we believe Modi’s coming back to power again could accelerate this Rebirth.   Every day since 2008, I have carefully studied the Indian economy. Though we’ve seen amazing progress over that time, I think it’s nothing compared to what’s coming.

I believe that from Uttar Pradesh to Tamil Nadu, Kashmir to Kanyakumari  and from Gujarat to Assam, the living standards of hundreds of millions of Indians, are about to take a giant leap forward…

I’m talking about better jobs, bigger salaries, and more financial security than ever before.   I shall quote few lines spoken by some renowned experts:

“The best days of our country are still ahead of us.”
Ramesh Damani, the Nawab of Dalal Street

“We’ve just started. The party has just begun.”
Ridham Desai, Managing Director at Morgan Stanley India

“India is a big story that isn’t going away for 30 years.”
Jim Walker, Chief Economist of Asianomics

“…the potential for India is incredible.”
Warren Buffett, the world’s greatest living investor

The experts agree, India is about to take off in a way we’ve not seen in our lifetimes.

We predict that most people could enjoy a modest but measurable improvement in their daily circumstances.  Some could make sizeable gains to see their incomes and net worth rise.
 India has already made incredible progress over the last two decades.

But as  we believe what we saw from the end of the License Raj until now, was simply a warm up for what we could see happening in the coming years.
I am now more certain than ever, India is about to make a “quantum leap” not seen in 1,000 years. India will complete its transition from “developing” to “developed”. And at the centre of this dramatic transformation are a series of revolutionary reforms initiated by Modi Government.

It’s certain that you may have already heard or read about these reforms before. Like most people, maybe even dismissed them as mere political stunts that will have hardly any impact on the reality. It’s my unbiased and objective view that these reforms are indeed transformative and could truly revolutionize the Indian economy and regular people’s lives in the years to come.

In fact, the highly respected and very successful entrepreneur V. Vaidyanathan of IDFC First Bank also gave a big “thumps up” to these reforms while speaking recently at India Economic Conclave 2018.

Mr. Vaidyanathan opined that these reforms have successfully put India on the road to becoming a US$ 5 Trillion economy in the coming years.

The truth is many of these reforms have been long due and even decades in the making.

Jandhan

 

As you may know, on 28th August 2014, the Indian Prime Minister launched an ambitious financial inclusion programme called the Pradhan Mantri Jan-Dhan Yojana (P.M.J.D.Y). The aim of this programme was to bring 7.5 crore low-income households under the banking net. The growth in Jandhan accounts led to a growth in savings and current accounts. As of 27 May 2018, 31.6 crore Jandhan accounts have been opened in all and a total amount of Rs 81,203 crores deposited in them.
Source: RBI, pmjdy.gov.in

As a result, millions of poor people now have access to debit cards, loans, insurance and even pension. And this has opened new avenues for them that didn’t exist before.

The latest report of the World Bank titled Global Findex Report 2017 cited that adult bank account holders in India have increased from 53% in 2014 to 80% in 2017.

As per a statement from the World Bank…

“Since 2010, more than 55 countries have made commitments to financial inclusion, and more than 60 have either launched or are developing a national strategy… Our research indicates that when countries institute a national financial inclusion strategy, they increase the pace and impact of reforms.”

I am confident that our Janadhan accounts too could play a huge role in bringing about financial inclusion and putting the Indian economy in overdrive in the coming years. So that’s one factor that will propel our economy forward.

Another shot in the arm….

Digitization

When people were forced to go cashless post demonetisation, many were averse to the idea. A lot of people felt it was risky, or quite a few weren’t tech-savvy enough to understand how to make digital payments.

But the digitisation of payments slowly but surely took off. People started using digital payments (UPI for instance) even for low-value transactions.

One could recharge mobile phones or book a ticket for a movie. Or even pay for electricity and LPG using the Unified Payment Interface (UPI) now.

UPI is beneficial not just for regular folks but also for the economy. Given the ease of using it, UPI registered transactions worth a whopping Rs 116,000 crores between Aug 2016 and Sep 2018.

Source: National Payment Corporation of India

And this is just the start…

We believe digital interfaces can, in the long-term, help reduce the amount of black money in the system, increase government revenues and give a boost to the economy.

Aadhar

In January 2009, the Indian government established a statutory authority, Unique Identification Authority of India (UIDAI), with the task of collecting biometric and demographic data of people, and thereafter allotting a unique 12-digit number called Aadhaar to each individual.
Aadhar is the world’s largest biometric ID system, and more than 1.17 billion Indians have Aadhar as of 15th Feb 2018.
Now Aadhar has a large number of uses. To name a few…
• It helps eliminate corruption in Government schemes
• It helps curb black money
• And it helps deliver subsidy and Government benefits such as mid day meal programs more effectively

And we can say the use of Aadhar is already paying off…

Source: Unique Identification Authority of India

Then linking Aadhar to bank accounts while filing income tax returns can be considered as one of the reasons for the rapid spurt in the number of taxpayers in India lately.

Just take a look…

Source: IncometaxIndia.com

Now, that’s huge.
Better tax compliance can lead to more collections…which in turn could be spent by the government more effectively, again by using Aadhar !
As per the UIDAI Chairman’s statement in a news article in July 2018, an analysis of the departments of petroleum and natural gas, food and public distribution, rural development and others showed that Aadhar has helped India save over Rs 90,000 crore.

All this money could be used for building infrastructure, providing better amenities to people, or for other economy boosting measures….

Then we have…

Goods and Services Tax

On 1 July 2017, the Indian government launched the Goods and Services Tax or GST.

The aim of GST was to replace a slew of indirect taxes with one unified tax – which in turn would help bring down prices of common goods, boost production and check black money to name a few benefits.

GST collections have been steadily increasing since its launch.

For the financial year 2018-19, GST collections,were expected to cross Rs 13,00,000 crores.

Source: Ministry of Finance

Now one sector that has benefitted immensely from GST is the manufacturing sector.

The IIP (Index of Industrial Production) data revealed that the manufacturing sector output has witnessed sharp and sustained growth since the implementation of GST.

And I believe that this is just the start.

In the years to come, and yes, you need to see this over years and not months, I believe the growth will only accelerate.

Just to take one example…

India’s logistics sector is also expected to gain significantly from GST.

Why?

Before the launch of GST, the transport industry had to spend a lot of time and resources on tax compliance and deposit of inter-state sales tax.

Due to this, while a truck in the US covered 200,000 kms a year on an average, a truck in India covered only about 50,000-60,000 km a year.

But after the introduction of GST, the interstate travel time for trucks is expected to drop by 20% as there will be no interstate check posts because of a unified tax.

And like I said…this is just the start. GST is expected to dramatically reshape India’s booming 2.4 trillion-dollar economy.

Real Estate Regulation Act

It’s common knowledge that in many cities and towns across India, delivery of completed projects is delayed for many years post the promised delivery date, with nowhere to turn to for the home buyers who put their hard-earned money into these projects.

That is exactly the issue the Indian government wanted to address with RERA.

The Government of India enacted the Real Estate Regulation Act or RERA with the aim to create a more fair transaction between the sellers and the buyers of properties, and make the scenario more buyer-friendly.

Among many things, RERA mandates that…

• Only registered developers can launch projects
• Developers cannot advertise their projects and seek bookings without getting all the required permissions
• Developers/project promoters must make all necessary disclosures about projects
• 70 percent of the money collected from buyers (including land cost) must be deposited in an escrow account to ensure that it is not diverted elsewhere
• If the project promoter fails to deliver home as per agreed deadline, they are bound to return the entire money invested by the buyers along with pre- agreed interest rate mentioned in the contract.

And so on!

Now how effective has RERA been so far in reality?

Reports show that tightening of rules has already brought down housing prices in the major cities in the last few years…

Source: Ministry of Housing and Urban Affairs

With the tight enforcement of RERA, things could get even better for home buyers in the years to come.

But that said, RERA is not just for home buyers…

Industry body PHD Chamber feels that RERA, if implemented with a positive approach, can help boost the GDP of the country too.

Vice-President of PHD Chamber, Rajeev Talwar said at a Conference…

“RERA is yet another big step forward. Its implementation in positive manner can boost the GDP of the country which dipped marginally in the previous fiscal.”

Think about it – right now several real estate projects are plagued with delays, disruptions and abandonments.

Following RERA properly could ensure that more projects are completed within the set time frames, and lead to overall real estate sector growth.

An article in the Economic Times stated – “On the positives, it has increased transparency and credibility leading to higher domestic and foreign investments as investors are now looking at Indian real estate with renewed vigour. The realty market is experiencing consolidation as unorganized players are struggling to cope with stringent compliance norms under RERA.”

Which means RERA could possibly be another supercharging factor for the Indian economy in the coming years…

Also, there is…

Bankruptcy Code

The new Insolvency and Bankruptcy code is yet another move that has bolstered a positive sentiment in the business arena.

As Raamdeo Agrawal of Motilal Oswal put it…

“If you failed in business before, nobody thought there was a price to pay. Now, people aren’t so sure.”

Yes! As per an article in the Economist in April 2018, a dozen large firms, that were in effect pushed into bankruptcy by the authorities last summer, account for $33.4 billion of bank debt. Another 28 cases due to be solved by September 2018 which account for another $33 billion.

Earlier, all these companies would have felt there was a way to get away.

But IBBI chief M S Sahoo feels the new Bankruptcy code has brought in behavioural changes among stakeholders. The consequences to be faced later are deterring the management and promoters of a company from filing for insolvency, instead convincing them to make best efforts to avoid a default.

The Bankruptcy Code is slowly but surely producing results…

Source: RBI

As per an article in Times of India in May 2018…

Over 2,100 companies have cleared loans to the tune of around Rs 83,000 crores thanks to the new Insolvency and Bankruptcy code.

This in sharp contrast to the earlier scenario where companies would be locked in insolvency disputes for years, and promoters of those companies would be leading their lives merrily without any fear.

So this law could help unlock money trapped with companies earlier and release it back into the financial system…

Internet Penetration

India is now the world’s second-largest mobile phone manufacturer under the ‘Make in India’ initiative.
Samsung recently set up a factory in Noida for manufacturing 120 million smart phones every year. And market research company e -Marketer said recently that more than a quarter of India’s population or 337 million people would use a smart phone in 2018.
That’s a 16 per cent growth over the previous year and the highest rate of any country in the world.

Source: TRAI

And this boom is not limited to smart phones only. Feature phone sales too have been on an upward swing.
That’s right! As per market research firm Counterpoint Research, feature phones grew at an astonishing 55% in the fourth quarter of 2017. Longer battery life and lower cost have made feature phones more appealing in tier-II, tier-III and rural areas.
The result?
Easy access to mobiles…and more importantly mobile internet…has opened up tremendous new possibilities and opportunities for users.
As per the Telecom Regulatory Authority of India…
As of December 2017, India is second highest in terms of total Internet subscribers with over 462 million Internet subscribers.
And this number is only going to go up from here…

Source: TRAI

What’s more, as per the TRAI, 7 out of 8 users access internet on their mobile phones today.

According to IBEF, due to this rising Internet penetration, India’s internet economy is expected to double from US$125 billion as of April 2017 to US$ 250 billion by 2020, with ecommerce playing a big role in it.

Once again paving the way for the Rebirth of India.

Talent Surplus

US-based global organisational consulting firm Korn Ferry has said that while the Asia Pacific (APAC) region would face a talent deficit of 47 million workers, India on the other hand would have a talent surplus of around 245.3 million workers by 2030.

Yes! Take a look at this chart…

Source: population.un.orgI

Bhavna Sud, Client Partner, Korn Ferry India, said: “The talent crunch will severely impact the growth of key markets and sectors across the region. India however, has the unique distinction of having a talent surplus right now and will continue to do so in 2030.”


So while other nations struggle to find people to work, India would have an oversupply of people willing to work.


But that said, we all understand that having more number of employable people will not result in any kind of benefit until and unless they can be properly utilized.


Ejaz Ghani, a lead economist at the World Bank, writes in live mint…
“Investing more and more efficiently in people will enable India to tap into its demographic divided, and prepare the country for the future. There is a powerful link between these investments and economic growth, stability and security. Investing in people through healthcare, quality education, jobs and skills helps build human capital, which is key to supporting economic growth, ending extreme poverty, and creating more inclusive societies.”
And we believe India has taken a number of steps in this direction in the last few years already.


Various initiatives started by the government like Make In India, Skill India, Start Up India, Stand Up India, Digital India and others are all important steps in this regard.

Programmes to build infrastructure and connect India are picking up pace. As per the Make In India website –

“New railway lines have been constructed in 2017 at an expenditure of Rs 4,531.93 crore. A five-year plan to build 83,677 km of roads has begun. Of this ambitious target, the Bharat mala Pari yojana programme will account for 34,800km of roads and create 14.2 crore man days of jobs in the process.”

In addition, the Make In India website also says…
“More than 100,000 Gram Panchayats or Village Councils now have access to high-speed broadband, thanks to Government of India’s Bharat Net project. Bharat Net is probably the world’s largest rural broadband project. As on December 31, 2017, 254,895 km of optical fibre cable had been laid across 109,926 Gram Panchayats as part of the project.”

In the 2017-18 budget, the government set aside Rs. 17,000 crore – the highest ever allocation to this sector, under the Skill India Mission.
Now the long-term impact of all these measures is yet to be seen.
But we believe that this one advantage by itself, if properly used, could lead India to become the Alpha economy of the world .
And I haven’t even come to the best part yet…
But there’s another big factor that could tip the scale in India’s favour and make it happen sooner than expected…

You see, India is still a tiny shadow of its former self…
India’s TRUE Potential Will Blow Your Mind

In the Tower of London, sitting behind bombproof glass, watched by 100 hidden cameras, and protected by 22 armed guards, is the Crown of Queen Elizabeth.
The crown is made from platinum and decorated with 2,800 diamonds. But the most impressive of all these diamonds, is the legendary Koh-i-Noor. The Koh-i-Noor, as you probably know, was mined in India, hundreds of years ago.
It’s worth more than an estimated $1 billion…
And it’s a small reminder of India’s rich history.
Blessed with an abundance of natural resources, and easily accessible by land or sea, India was once the economic center of the ancient world.

The Silk Road and Spice Trading Routes
Brought Rich Rewards to India…

Source: NASA/Goddard Space Flight Center

Merchants came from Europe, Africa and Asia to buy sugar, spices, peppers, cotton, silk and more.
Our country was flooded with gold and silver.
According to British economic historian Angus Maddison, India was the world’s richest nation from 1 to roughly 1,500 AD…which is about 2,000 years ago.
You can see in the chart here, India once accounted for about 33% of the world’s GDP (that’s more than what the USA contributes to world GDP today)…
India Was the World’s Richest Country for 1,500 Years!

Source: Wikipedia/M Tracy Hunter

But what you can also see in this chart, is India’s steady fall from the wealthiest nation in the world, to one of the poorest.
Centuries of war, looting, and colonialism left us with virtually nothing by the mid-twentieth century.
But there’s no need to lose hope, because we believe India is at the verge of an incredible rebirth…

India Could Be the World’s
Richest Country Again…
Yes! Impossible as it might be to imagine, I predict we could be one of the world’s wealthiest nation again.

According to data from the World Bank, India’s GDP in 1991 was the 17th largest in the world.
And the most recent data from the World Bank now shows, India has jumped eleven places, becoming the 6th largest economy in the world.
Yes! In fact, just 75 years after winning independence from Britain, we’re on track to be richer than our old rulers…
Getting Rich is the Best Revenge!
One of the challenges India has faced since the colonial period has been the relentless effort of richer countries to appropriate its resources and wealth away from India through economic manipulation, forced negotiations and sometimes outright theft.
For instance…
In 1849, the British forced 10-year-old Sikh King, Duleep Singh, to give up one of India’s most valuable treasures
The Koh-i-Noor diamond
It was a symbolic end of India’s reign as a world superpower. And the unabated plunder continued for nearly a century after that.
But the scenario is set to undergo a dramatic reversal very soon….

Source: data.WorldBank.org

As the United Kingdom’s GDP plateaus, India is on the path to overtaking its
old rulers and becoming the world’s 5th largest economy…
Fact: As Western economies are stuttering and stalling, India is still growing.
One recent study by Harvard University concluded that:
The economic pole of global growth has moved over the past few years from China to neighbouring India, where it is likely to stay over the coming decade.” – Harvard University Study

In other words, researchers at Harvard University think India is the most important economic growth story in the world right now–NOT China and NOT the USA.
And according to a news report, Jim Walker, Chief Economist of Asianomics, says that:
“India is a big story that isn’t going away for 30 years.”
But despite everything we’ve seen so far, India accounts for just 3.2% of the world’s GDP right now.
Remember, over 2,000 years ago, India contributed about 33% of the world’s GDP.
In other words, if India’s history is any indication, our economy has the potential to grow TEN times bigger from here to become the Alpha economy of the world in a decade or two!