A gentleman from India recently raised a discussion during a class that concerned the newly elected Prime Minister Modi. For many unaware, the recent election in India was considered a “a landslide victory for opposition leader Narendra Modi.” This particular student was drawing the connection regarding the expected economic impact on the region.
The media isn’t short on coverage for this international event, but Forbes did indicate two interesting reasons why something like this would move the Sensex index up 4.5%, which was the highest in five years. It’s expected to continue to increase, and here’s why:
1) Modi’s platform focused on pro-business economic development.
2) “It would appear that the National Democratic Alliance, a group that is led by Modi’s Bharatiya Janata party, is going to take over 300 seats, which would mean a government that would not have to solicit coalition partners and the compromises that would necessarily go with doing so. India has often been impeded by policy paralysis caused by unstable coalitions and this would help the new government to act more decisively – although the long-standing issue of deadlock between federal, state and local governments isn’t going away (nor should it, really, in India’s sophisticated democracy).” ~Forbes
The Wall Street Journal connected the election to the international economy as well, indicating
Narendra Modi’s victory in the Indian election is expected to improve trade ties between New Delhi and Washington and could eventually lift U.S. exports in industries ranging from pharmaceutical products to heavy infrastructure, U.S. officials and business leaders say.
Pro QC’s Country Manager in India, Daniel Ben-Ezra, recognizes and supports this opportunity. He explained that “the election victory of Modi and his BJP party majority in the house will likely imply a soon to be improved economic climate for India, with heavy investments expected in, for example, infrastructure. This should theoretically be good news to all companies producing in or sourcing from India.”