I knew the Indian market was in a big bubble when “Nifty 50” started trending across all social media. I think the Indian economy will go through a deep recession as a result of all the bubbles bursting.
And fundamentals for Indian economy are horrible. Look at what happened in China vs India in the past three decades. Arguably, China started from a worse economic place/position and outpaced India rapidly. Is it cultural? Perhaps.
> Look at what happened in China vs India in the past three decades.
I'm investing in the future, not for the past 3 decades. The Chinese economy is a debt ridden liability in 2023 with political uncertainty around President Xi and the real-estate bust.
India OTOH .. Please do unbiased research here. Most analysts estimate India to be the fastest growing large economy in 2023. A quick Google search will get you all the references here.
Manufacturing is leaving China towards India and Vietnam. Best of all, India is a self-consuming economy, they aren't reliant on exports, their growing population and potential for lifting people into the middle class alone will offer multiple decades of steady growth.
> Is it cultural? Perhaps.
Thanks for confirming your bias against Indian people and their culture. I have no incentive to debate with you anymore.
If you are investing in the future, how are you accounting for the growing population while the Indian subcontinent will suffer some pretty harsh effects from climate change, mainly regarding water security? India vs China is a big topic there, with China trying to seize control of Himalayan sources of major rivers across the area.
I'd guess in this accounting you also should take in consideration what Modi's government set in motion, a nationalistic movement that is enlarging ethnic-religious wedges, couple that with a still growing population coming under stress of resources shortage and it's a ticking time-bomb for civil wars and worse. On top of all the income inequality that is already pretty stark. How are you planning for the future with all of that? Because only economical metrics won't take you anywhere close to those factors which are definitely in the horizon for the next 10-20 years.
Pretty much all points raised regarding India can be applied to China and vice versa. China is however becoming too expensive to continue their economic model and rift with the west is becoming larger. If Apple is moving towards India, many more will follow.
Yes, they do but China isn't growing their population at all on the same level as India, that was my main point of concern there, in a world with dwindling access to some basic resources such as water, what will a boom of population cause in a society with already almost 2bi people in it?
I agree that energy is the main currency for development but saying that with abundant energy the rest can be gotten sounds almost like a Deus Ex Machina way out of some issues that, on the scale of population India, are pretty damn big. You can have desalinisation plants for Israel with ~10 mil pop. but desalinisation to provide fresh water for 200-500m people is a complete different ballpark, or even completely different game.
I don't agree with this reduction that with enough energy a country can achieve whatever, might work with "given infinite cheap energy" thought models but when you apply that to reality there are lots of pesky constraints...
1.4B are surviving on the resources at the moment so it's not that bad. You can always find a reason to be negative about the future. However that is a poor mindset for investing. "Pessimists sound smart, optimists make money" is a popular saying.
I would rather rephrase that to "Pessimists sound smart, opportunists make money".
It's not about optimism, it's about how you can make money until issues bite, and then how to divest to avoid the consequences... Actually now it makes into a very fitting and tragic parabole to what something like investing in the oil industry looks like :)
The growing population is a good thing. Their old will die and their young will be able to renew. In times of great strife that's the kind of demographics you need. I think it sets India up well.
Only if their young have the infrastructure to cover their basic needs while developing. If they can't and are forced to share a dwindling pool of resources necessary for basic needs (food, water, for example) you don't get a young generation working in cooperation to renew but a escalation of disputes for resources as those become scarcer/harder to access.
AJ Kalam's 2020 visions for India were inspired by his 1997 visit to Malaysia. He wanted India in 2020 to be on par with 1997's Malaysia. Not exactly a "first world superpower".
Today India's GDP per capita is roughly half of Malaysia's 1997 GDP per capita. India definitely underperformed but not by the several magnitudes of orders that people assume were AJ Kalam's visions.
I look at Africa and see a continent that was chopped up by colonial powers into borders designed to create social and ethnic conflicts. It was a project to create as many wedges as possible so the colonists could keep power by the ol' divide-and-conquer (which the Brits were pretty apt at). Then you have some of the usual colonial genocides, resource extraction with no further improvements to the source, etc.
It's not cultural if it was designed to create issues, it's such a stupid reduction of a problem that's been entirely manufactured by colonial powers for centuries. Or is that what you are calling "cultural problems" by now?
Please don’t dismiss a cultural argument as a bias against a culture.
It should be perfectly fine to hypothesise about the impact of cultures. I’m a German living in Sweden, and I can tell you that even though the cultures are very similar, there are differences that have a massive impact. Sweden is highly digital, Germany feels like stone age in comparison. And that has almost exclusively cultural reasons: after decades of Nazi and Easy/West split, Germany became brutally cautious around anything involving privacy.
Hopefully this example illustrates that cultural reasons are an important factor in discussing societies, and should not automatically be dismissed as someone having a bias for or against a certain culture.
It's hard to generalize about something as amorphous and diverse as "Indian culture" (the scare quotes are warranted), but I'd posit that religion makes a large difference between India and China. China was atheist for decades and religion remains by and large pretty marginal today, while in India it's huge right across the social spectrum. The concepts of caste and karma are very Indian too: how the poor are preordained into their lot and the lower castes are stomped down with mob violence if they get too uppity. (Yes, this may sound uncomfortably familiar to Americans.) Urban India is ditching a lot of this baggage at varying speeds and growing fast (cause or effect?), but in wide swathes of the countryside life and belief remains near-medieval.
China might have a huge bad debt problem, but theyre a more efficient and better manufacturer that India. They can crank up production on anything faster than anyone else. They're not done by a huge margin. India is up and coming and I can see a large amount of business coming it's way, and I'd much rather invest in India than China, but I don't think it will ever come close to knocking China off it's perch.
China remains a manufacturing powerhouse, while the likes of India, Vietnam etc. also make rapid strides. Just look at the trend towards "friendshoring" / "allyshoring" and the likes of Apple, Samsung etc. moving manufacturing from China to India / Vietnam.
Also, it helps in stable growth that India's population is growing and consumption is internal.
"Strawman arguments" such as war with China, ecological crisis etc. are redundant.
It goes without saying that if there's a major ecological crisis or a war, India could suffer. Any country could suffer with those conditions.
These are but one of many factors in a prediction model, and dare I say these aren't decisive factors.
China is collapsing any moment now since 2014… The reality, the Chinese economy is still growing strongly despite its enormous size; and they are also making innovative companies (Xiaomi/Tiktok comes to mind). Their cars started recently taking over the market. Indian’s car industry is still not there yet.
China might get in a recession, but they’ll remain the second for quite a long time in the next 30 years.
Google maps doesn't lie though. China is building too much infrastructure that it's unprecedented. There is a lot of money coming out of China too, so maybe they lie but a big part of it is true.
Improve yes, but see same benefits, probably not. The geopolitical enviroment where world will concentrate manufacturing in one country is over. And even at height PRC manufacturing employed like 300M, India will only get fraction since PRC as incumbant gets to direct large % of where supply chains flow to, add in automation and India will get even less. Reality is even if India executes perfectly, which she's far from able to seeing how infra base is still decade+ behind from when PRC started hammering SEZs and manufacturing, she'll only get fraction of benefit, that's going to be fractioned again because her population still growing. For reference PRC uplifted 300/1300M (2000s pop) during usually stable international enviroment where stars aligned, IMO India lucky to get 100/1400-1700M pop trying to replicate PRC.
Culturally speaking, both countries are strong. Indians place high value on education (especially STEM) and hard work.
I don’t think that’s enough to unleash the power of the country. The current elite have an outsized influence on the future of country. In the case of China, they might be authoritarian leaders but they have the interests of their country at the front (even though if internal corruption is rampant)
The lack of manufacturing in India is scary. They seem to think they can become a developed country with substinence farming and IT outsourcing. That is simply not possible.
They are, Apple is moving a significant part of it future manufacturing there. But problem with doing manufacturing in India is the speed at which the things get done, the poorer infrastructure and the endless red tape/corruption. Maybe greater foreign investment will break down or reduce some of those obstacles.
Social strife and political gridlock will ensure that the results remain subpar.
The rhetoric in India over the last decade has successfully turned two communities (Hindus, Muslims) against each other to the point where public calls for violence and economic boycott are an everyday occurrence.
There is no social strife in India. There's just propaganda, amplified by mostly Western media.
There are 1.3 billion people here. There are fewer incidents than what we see coming out of Portland OR alone. Or France and Sweden in December end.
The problem is that the current government does not listen to the West any more. Pfizer etc were shown the door. Russian gas imports have increased massively since April 2022.
There's an election coming up and the current government is likely to continue.
Hence the coordinated attacks by the BBC and this short-seller.
There's a lot of social strife. We've seen how the other religions are being persecuted. Caste based issues still cause friction. Then there's regional seperatism, rich v poor. There's a lot more cause for social problems in India by far then there is in China. You're being disingenous if you say there arent.
If you think that the current govenrment doesnt listen to the West then you dont really understand the balance of economic power in the world. Virtually all of the growth that India as achieved in the last 20 years comes from selling to the West. If we shut you down like we did with Russia, how long do you think your economy would last. India is only as big as the UK or France in economic terms, they have a good growth story, but dont think you're in anyway big enough to cause the west any problems or big enough to ignore what they want.
We're much stronger now, economically and otherwise.
If attempted, see how it accelerates de-dollarisation. R5 has already been announced. The moment OPEC switches away from the dollar, the US economy is done for.
that talks about how India’s “social strife” in your terms has impacted its relationships with its neighbors. It’s useful, because (1) it has no data, which is quite typical of such articles, and (2) it uses the claim of social strife to predict a specific result. Worsening relationships with neighbors.
So we can test the results. And turns out, little more than a year later, India’s relationships with its neighbors (outside Pakistan, for obvious reasons), has never been better.
India, as an extremely young, diverse, and massive democracy has a lot of issues. Its very hard to see in actual numbers and data that those issues, including “social strife” have actually worsened over the past few years, beyond the impact of the pandemic.
I can post a rebuttal, but I want to ask: do you think its healthy for the long-term future of any country if the leading political party does not even have a token MP from the largest minority? Do you think there can be a progressive future if nearly 1/5th of the population is not even invited for a dialog, let alone given a seat at the table?
Objectively speaking, regardless of your political leanings or religious views, I can’t see how leaving out 1/5th of your people will help everyone progress.
South Africa managed the country economy well during the Apartheid ... Spain had economic miracle under Franco. Israel is chugging along just fine - even with its extremely complicated relationships with Israeli arabs. China is also a nice place to live if you are not Uygur ...
Oppression and economic prosperity are not mutually exclusive.
> Even if you ignore the findings of our investigation and take the financials of Adani Group at face value, its 7 key listed companies have 85% downside purely on a fundamental basis owing to sky-high valuations
that is their leading allegation. the company is overvalued because they say so. (and stocks always trade on fundamentals)
going down the long list of "allegations" every single one is normal business practice for any wealthy individual or large corporation. they own a lot of corporate entities in different jurisdictions and have been accused (but never found guilty of) money laundering and tax evasion. not exactly earth shattering stuff.
i don't know anything about this company, but this report has no substance, and coming from what is essentially a no-name blogger with no significant position to trade on, it is not unreasonable to wonder why reuters, nyt, and bloomberg would be trying to give this credibility.
They aren't a no-name blogger. They investigated Nikola and uncovered a lot of fraudulent practices. Have a read if you're not familiar with their work.
They also threatened an environmental activist from Queensland, Australia by sending private investigators to stalk him and his nine year old daughter. They're beyond corrupt and are a criminal organisation.
If Adani Group is as big as it seems from the recent attention they've been getting (I am totally naive to the Indian economy) it should be safe to assume they have some involvement with international banks. If so, what's the potential for financial contagion?
As a retail investor, I have never bought shares of any Adani company. Most mutual funds also stayed away from them. Crony capitalism has always been a hallmark of Indian economy especially before economic liberalisation in 1991. Advani's main rival and India's richest man Mukesh Ambani and his father built their empire on favourable government regulations. It has happened across party lines. But with Adani is has been so brazen and so blatant that it's not even shocking anymore. One day my electricity provider suddenly became Adani, then my city's airport became Adani's. Ports, airports, highways, utilities all the critical infrastructure was suddenly being sold off to Adani. All funded by debt. While one must admire the ambitious nature of Adani, it definitely felt like it was spreading too fast too thin. The mysterious rise in Adani company shares in last 2-3 years made me even more resolute in not owning any Adani stock. You just don't know when the bubble will burst.
What is worrisome is that one of the largest lenders to Adani is public sector bank SBI. Another investor is India's largest and state owned insurance company LIC. LIC and SBI have been used as piggy banks by successive governments. A bank in trouble, SBI saves it (Yes bank), state owned company's IPO not doing well? LIC steps into buy it. It's public money which the governments waste on saving their friends. And the irony is public sees nothing wrong in it.
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[ 3.7 ms ] story [ 110 ms ] threadThere will always be ups and downs, but I am extremely bullish on the Indian economy long term.
Hindenburgs' / Adani's are just games people play -- these will at best have short to medium term effects.
If you like the fundamentals, stick with long term investments.
I'm investing in the future, not for the past 3 decades. The Chinese economy is a debt ridden liability in 2023 with political uncertainty around President Xi and the real-estate bust.
India OTOH .. Please do unbiased research here. Most analysts estimate India to be the fastest growing large economy in 2023. A quick Google search will get you all the references here.
Manufacturing is leaving China towards India and Vietnam. Best of all, India is a self-consuming economy, they aren't reliant on exports, their growing population and potential for lifting people into the middle class alone will offer multiple decades of steady growth.
> Is it cultural? Perhaps.
Thanks for confirming your bias against Indian people and their culture. I have no incentive to debate with you anymore.
I'd guess in this accounting you also should take in consideration what Modi's government set in motion, a nationalistic movement that is enlarging ethnic-religious wedges, couple that with a still growing population coming under stress of resources shortage and it's a ticking time-bomb for civil wars and worse. On top of all the income inequality that is already pretty stark. How are you planning for the future with all of that? Because only economical metrics won't take you anywhere close to those factors which are definitely in the horizon for the next 10-20 years.
I don't agree with this reduction that with enough energy a country can achieve whatever, might work with "given infinite cheap energy" thought models but when you apply that to reality there are lots of pesky constraints...
It's not about optimism, it's about how you can make money until issues bite, and then how to divest to avoid the consequences... Actually now it makes into a very fitting and tragic parabole to what something like investing in the oil industry looks like :)
There is nothing wrong with saying it’s cultural problems. Look at Africa for instance.
Today India's GDP per capita is roughly half of Malaysia's 1997 GDP per capita. India definitely underperformed but not by the several magnitudes of orders that people assume were AJ Kalam's visions.
I look at Africa and see a continent that was chopped up by colonial powers into borders designed to create social and ethnic conflicts. It was a project to create as many wedges as possible so the colonists could keep power by the ol' divide-and-conquer (which the Brits were pretty apt at). Then you have some of the usual colonial genocides, resource extraction with no further improvements to the source, etc.
It's not cultural if it was designed to create issues, it's such a stupid reduction of a problem that's been entirely manufactured by colonial powers for centuries. Or is that what you are calling "cultural problems" by now?
It should be perfectly fine to hypothesise about the impact of cultures. I’m a German living in Sweden, and I can tell you that even though the cultures are very similar, there are differences that have a massive impact. Sweden is highly digital, Germany feels like stone age in comparison. And that has almost exclusively cultural reasons: after decades of Nazi and Easy/West split, Germany became brutally cautious around anything involving privacy.
Hopefully this example illustrates that cultural reasons are an important factor in discussing societies, and should not automatically be dismissed as someone having a bias for or against a certain culture.
If someone makes the cultural argument, the onus is on them to provide proof for such an argument.
Please go ahead and give valid reasons why "Indian culture" is not suitable for steady long term economic growth.
China remains a manufacturing powerhouse, while the likes of India, Vietnam etc. also make rapid strides. Just look at the trend towards "friendshoring" / "allyshoring" and the likes of Apple, Samsung etc. moving manufacturing from China to India / Vietnam.
Also, it helps in stable growth that India's population is growing and consumption is internal.
"Strawman arguments" such as war with China, ecological crisis etc. are redundant.
It goes without saying that if there's a major ecological crisis or a war, India could suffer. Any country could suffer with those conditions.
These are but one of many factors in a prediction model, and dare I say these aren't decisive factors.
China might get in a recession, but they’ll remain the second for quite a long time in the next 30 years.
China lies. They lie about their horrific demographics and they lie about their economic growth.
I don’t think that’s enough to unleash the power of the country. The current elite have an outsized influence on the future of country. In the case of China, they might be authoritarian leaders but they have the interests of their country at the front (even though if internal corruption is rampant)
Some go back, or maintain ties, but by and large they're staying where they go.
Here if even a state government changes political parties, the first thing which happens is that the previous government's policies are undone.
Start building factories and things, India.
The rhetoric in India over the last decade has successfully turned two communities (Hindus, Muslims) against each other to the point where public calls for violence and economic boycott are an everyday occurrence.
Hard to thrive in that environment
There are 1.3 billion people here. There are fewer incidents than what we see coming out of Portland OR alone. Or France and Sweden in December end.
The problem is that the current government does not listen to the West any more. Pfizer etc were shown the door. Russian gas imports have increased massively since April 2022.
There's an election coming up and the current government is likely to continue.
Hence the coordinated attacks by the BBC and this short-seller.
If you think that the current govenrment doesnt listen to the West then you dont really understand the balance of economic power in the world. Virtually all of the growth that India as achieved in the last 20 years comes from selling to the West. If we shut you down like we did with Russia, how long do you think your economy would last. India is only as big as the UK or France in economic terms, they have a good growth story, but dont think you're in anyway big enough to cause the west any problems or big enough to ignore what they want.
The self-entitled arrogance
We're much stronger now, economically and otherwise.
If attempted, see how it accelerates de-dollarisation. R5 has already been announced. The moment OPEC switches away from the dollar, the US economy is done for.
Just Brahman things
Also, how is the social strife actually reflecting itself?
The U.S. has a homicide rate that is more than double that of India. That indicates that the U.S. has far more social strife than India.
This is an excellent article
https://www.nytimes.com/2021/11/06/world/asia/india-region-m...
that talks about how India’s “social strife” in your terms has impacted its relationships with its neighbors. It’s useful, because (1) it has no data, which is quite typical of such articles, and (2) it uses the claim of social strife to predict a specific result. Worsening relationships with neighbors.
So we can test the results. And turns out, little more than a year later, India’s relationships with its neighbors (outside Pakistan, for obvious reasons), has never been better.
India, as an extremely young, diverse, and massive democracy has a lot of issues. Its very hard to see in actual numbers and data that those issues, including “social strife” have actually worsened over the past few years, beyond the impact of the pandemic.
Objectively speaking, regardless of your political leanings or religious views, I can’t see how leaving out 1/5th of your people will help everyone progress.
Oppression and economic prosperity are not mutually exclusive.
https://hindenburgresearch.com/adani/
that is their leading allegation. the company is overvalued because they say so. (and stocks always trade on fundamentals)
going down the long list of "allegations" every single one is normal business practice for any wealthy individual or large corporation. they own a lot of corporate entities in different jurisdictions and have been accused (but never found guilty of) money laundering and tax evasion. not exactly earth shattering stuff.
i don't know anything about this company, but this report has no substance, and coming from what is essentially a no-name blogger with no significant position to trade on, it is not unreasonable to wonder why reuters, nyt, and bloomberg would be trying to give this credibility.
bloomberg has still never withdrawn their totally fabricated story about supermicro https://www.bloomberg.com/news/features/2018-10-04/the-big-h... https://www.bloomberg.com/features/2021-supermicro/ https://www.servethehome.com/investigating-implausible-bloom... that story tanked supermicro's stock by 40% at the time, but they are up 500% since then, so obviously that was not a winner.
https://hindenburgresearch.com/nikola/
https://www.theguardian.com/australia-news/2022/nov/29/still...
What is worrisome is that one of the largest lenders to Adani is public sector bank SBI. Another investor is India's largest and state owned insurance company LIC. LIC and SBI have been used as piggy banks by successive governments. A bank in trouble, SBI saves it (Yes bank), state owned company's IPO not doing well? LIC steps into buy it. It's public money which the governments waste on saving their friends. And the irony is public sees nothing wrong in it.