India - economic optimism for 2010

After returning from India last week, one of the main differences in the conversations going on between business here in the UK and in India is the way growth is discussed. In the UK the talk is of recovery, in India the talk is all about how much the economy will grow this year. Discussion in India is optimistic, rather than the UKs current trend of Pessimism. The Federal Government of India is Predicting a return to growth of around 7% this year. The Chairman of ICICI bank is even more optimistic predicting India’s growth rate to be at 10% by 2011.

Much of this optimism comes from the changes we see in India, firstly the county never entered recession as the West did, there was only a slight drop in Growth. Secondly, the improvements to the country’s infrastructure are dramatic; the road network for example is almost unrecognisable from only 15 years ago. Entrepreneurs across the county are all looking for new opportunities, both national and international and the demand for luxury consumer goods in India is increasing year on year.

Ironically there is talk of Bonuses in the Indian Media, but it’s not focused on Bankers, rather IT companies. The rate of Growth in the IT sector has been much higher than expected over the last year, Tata Consultancy for example plan a 150% bonus pay out for 2010.

They are not the only company in the sector revealing higher than expected profits, nor is the IT Sector alone in displaying stronger than predicted results, the economic prospects for the coming year in India look great.