India to outperform global peers on strong consumption, FTAs to boost exports: HSBC Mutual Fund India CEO
New Delhi, Aug 5
India is likely to continue outperforming most major global economies despite persistent global uncertainties, supported by strong domestic consumption and rising exports, HSBC Mutual Fund India Chief Executive Officer Kailash Kulkarni said on Wednesday.
In an exclusive interview with IANS, Kulkarni said robust domestic demand, coupled with the government's reform measures and expanding trade ties, would help sustain India's growth momentum.
"India's economy will continue to perform better than many other countries despite global uncertainties. Strong domestic consumption and continued growth in exports will support the economy," he said.
Kulkarni attributed India's strong economic performance to three major factors -- the government's focus on strengthening balance sheets, rising foreign direct investment (FDI) inflows and the country's increasing number of Free Trade Agreements (FTAs).
He said India's recent FTAs with several countries would benefit a wide range of sectors rather than a single industry.
"Industries such as jute, textiles, automobiles, defence, information technology and several others stand to gain from these agreements," he said, adding that the trade pacts would help the economy sustain growth of over 7 per cent.
On whether midcap and smallcap stocks would continue to outperform largecap stocks, Kulkarni said history suggests that mid- and small-cap segments have generally delivered superior long-term returns, although they are inherently more volatile.
"Whenever markets witness heightened volatility, mid- and small-cap stocks tend to underperform. However, over the long term period, they have historically generated better returns than largecap stocks," he said.
Commenting on investor behaviour during periods of global uncertainty, Kulkarni said sustained investor awareness campaigns over the past few years had encouraged investors to adopt a disciplined and long-term approach to investing.
As a result, investments through Systematic Investment Plans (SIPs) have continued to rise as investors increasingly recognise the route as an effective way to navigate market volatility, he added.
— IANS
Reader Comments
Optimistic outlook, but let's not forget that GDP numbers don't always reflect ground reality. The common man is still feeling the pinch of inflation. Hope these FTAs actually benefit small businesses and farmers, not just big corporates.
The comment on SIPs is reassuring! I've been investing through SIPs for 5 years now and it really helps during volatile times. Systematic investing is the way to go for retail investors. 📈
As someone working in the textile industry, I'm cautiously optimistic about the FTAs. But we need to ensure Indian manufacturers are competitive enough to actually benefit. The government must focus on infrastructure and ease of doing business.
Impressive to see India's resilience while much of the world struggles. The combination of strong domestic demand and international trade expansion is a winning formula. Looking forward to see how this plays out over the next few years. 👍
Midcap and smallcap stocks have indeed given great returns historically. But new investors should be careful - they're not for everyone. Start with index funds if you're not sure about picking individual stocks. Discipline matters more than timing the market.
Good to see Indian economy getting this recognition! But let's not be complacent
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