Solid Path to Recovery Opens Up Opportunity for India ETF | ETF Trends

Emerging markets (EM) give investors an opportune chance to obtain potential growth in other parts of the globe, and one country worth noting amid the global economic recovery is India.

Economies around the world took a hit amid the pandemic, but 2022 could see more recovery despite rising cases driven by the latest variant, Omicron. India in particular is looking forward to more growth this year.

“India is forecast to grow at 6.5 per cent in fiscal year 2022, a decline from the 8.4 per cent GDP estimate in previous financial year, and while the country’s economic recovery is on a ‘solid path’ amid rapid vaccination progress, coal shortages and high oil prices could put the brakes on economic activity in the near term, the UN said on Thursday (January 13),” Business Standard reports, noting the numbers circulated by a United Nations World Economic Situation and Prospects (WESP) 2022 report.

“India’s economic recovery is on a solid path, amid rapid vaccination progress, less stringent social restrictions and still supportive fiscal and monetary stances, the report said,” Business Standard adds further. “The report noted that for India, robust export growth and public investments underpin economic activity, but high oil prices and coal shortages could put the brakes on economic activity in the near term.”

Getting EM Exposure to the Sixth-Largest Economy

When getting EM exposure, it’s easy to mention China as the first option given its current status as the second-largest economy. However, India can still offer growth opportunities that may have been tamped down by the pandemic.

That said, investors looking for an EM prospect for potential growth can look to the sixth-largest economy: India. One way to get concentrated exposure to the country is the Invesco India ETF (PIN).

PIN seeks to track the investment results of the FTSE India Quality and Yield Select Index. The underlying index is a modified market capitalization-weighted index of equity securities that are traded on the National Stock Exchange of India.

“This ETF offers exposure to Indian equity markets, making PIN one of many ETF choices for investors looking to access an emerging market that maintains both tremendous growth potential and considerable volatility,” an ETF Database analysis offers. “Considerable India exposure is a part of many broad-based emerging markets ETFs, but those looking to overweight this economy may find PIN to be a useful tool.”

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