The Reserve Bank of India has adopted a soft monetary policy, issuing banking sector funds to aid the economy.
On the upside:
- Companies will likely ask banks for working capital loans as the IPO market picks up, which would help revive the economy
- The auto and infrastructure industries are seeing more demand
- Industrial production is up
- Business confidence is on the optimistic side
- Stock markets are strong
On the downside:
- Private consumption demand is slowing
- The first quarter showed a decline in corporate sales
- A weak monsoon season has hurt agricultural output
- Credit growth is low
- Exports have dipped
- PowerShares India (NYSEArca: PIN): up 64.2% year-to-date
- WisdomTree India Earnings (NYSEArca: EPI): up 78.7% year-to-date
Max Chen contributed to this article.