Investing in India

The private sector ruined itself in the bubble of ’03-’07. Now, it’s the public sector’s turn. All over the developed world – with a few exceptions – the feds are adding debt at an alarming rate.

"The US has already passed “the point of no return,” says a report from Casey Research. Ken Rogoff and Carmen Reinhart put that point where external debt passes 73% of GDP or 239% of exports. IMF data, says the Casey team, shows the "US has already gone too far on both scores, with external debt at 96% of GDP and 748% of exports."

Over the last 12 months, Mumbai’s Sensex index has gone up more than 108%.

But your bet on India is for the very long term. In the recent financial crisis, that bet seemed to go bad. Foreign investors pulled their money out of India along with other emerging markets – even though India had very little exposure to the banking crisis itself.

What’s ahead?

Seven percent GDP growth this year…nine percent next year.

The first figure is news. The second is a forecast. But there are good reasons to be bullish on India for the long pull.