Beruflich Dokumente
Kultur Dokumente
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Risks to Indias growth: Real Risks to Indias growth: Real but overstated but overstated
The Indian entrepreneurial spirit can only develop and grow if the Indian economy continues to grow on a sustainable basis. The risks to Indias continued growth are terrorism, political corruption / stalemate, non-inclusive growth that focuses only on the urban rich, and stalled reforms. What then is Indias risk premium?
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Risks to Indias growth: Real Risks to Indias growth: Real but overstated but overstated
As the investment cycle strengthens, foreign businesses can invest in India independently or through partnerships. The businesses factor the political, economic and family risks in their analysis.
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Risks to Indias growth: Real Risks to Indias growth: Real but overstated but overstated
From an academics perspective, the businesses can either decrease the expected cash flows or increase the discount rate to reflect risk premium, though the adjustments are complex. However, I view investments in India as a strategic decision. In the next few slides let us discuss the risks and our understanding of them.
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Terrorism: India is a stronger Terrorism: India is a stronger state because of its culture state because of its culture
As per Wikipedia, Terrorism in India is primarily attributable to religious communities and Naxalite [militant Communist Group] radical movements. I am not going to elaborate on the causes of terrorism but I do want to ask if India as a country will it survive and remain united despite the nefarious activities of the insurgents.
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Terrorism: India is a stronger Terrorism: India is a stronger state because of its culture state because of its culture
It can be stated unequivocally that terrorism creates uncertainty and delays investments in any country. However, we need to comprehend a countrys culture, constitution and its past response to terrorism to consider and assess its fate.
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Terrorism: India is a stronger Terrorism: India is a stronger state because of its culture state because of its culture
Culture is a broad-based word but a powerful concept. Culture is rooted in myths, institutions, television, globalization, upbringing, religion and history. Foreigners have invaded India, but we have learnt to absorb and assimilate them into our society. India has the second-largest Muslim population in the world. Buddhism and Jainism had their roots in India but only traces exist today, as Hinduism absorbed their teachings.
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Terrorism: India is a stronger Terrorism: India is a stronger state because of its culture state because of its culture
The Indian culture is tolerant and can deal with differences. The difference between Europe and India is that Europe is a continent with independent countries while India is one country that has united many divergent countries.
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Terrorism: India is a stronger Terrorism: India is a stronger state because of its culture state because of its culture
The Indian culture is also resilient and able to respond sensibly to any terrorist activities. As evidence, Indians response to the November 26th 2008 terrorist attack in Mumbai was balanced and restrained. I am confident that, given Indias history and behaviour, we will remain united as a country.
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Terrorism: India is a stronger Terrorism: India is a stronger state because of its culture state because of its culture
At the same time, Indian businesses have shown the entrepreneurial skills and flexibility to grow despite the challenges. For instance, an Indian entrepreneur in Afghanistan is assisting the government to develop that countrys infrastructure. C&C Construction Ltd, incorporated by a group of professionals in 1996, ventured into Afghanistan in 2002.
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Terrorism: India is a stronger Terrorism: India is a stronger state because of its culture state because of its culture
It has built 700 km of roads, and works closely with USAID, the World Bank and the Asian Development Bank. C&C Construction will also work closely with the Indian Government to build the Afghan parliament building.
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Political risk: Uncertainty will Political risk: Uncertainty will remain remain
India is a complex country with myriad castes, religions and languages. The political parties have evolved to address their needs and give the minority groups a platform and a voice that are heard at the national level. The foreseeable future will be characterized by coalition politics. It is unlikely that either of the two major political parties BJP or Congress will win a majority. This is a reality, but India has the experience to manage the political processes and differences
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Political risk: Uncertainty will Political risk: Uncertainty will remain remain
It is evident that a coalition government slows the reform process. However, it is a positive development, that, irrespective of the coalition government (lead by either BJP or Congress), we have stayed the path of liberalization. There are no major differences between Congress and BJP as far as economic policies are concerned, and both favour economic reforms. And, as Indias middle class grows, the importance of religion and caste will diminish; the focus will be only on growth. Economic progress will change Indias political landscape for the better and further improve political stability.
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Thank you
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