Modi better than Trump; India will outperform US over 5-10 years:

 Marc Faber India, according to PwC, in 20-30 years will become a second largest economy in the world similar to China On a day when market scaled record high on Tuesday, Marc Faber cemented bullish sentiment further by saying that India will continue to outperform the US and other western markets, The editor and publisher of The Gloom, Boom, and Doom Report said that India has got a new government with (Prime Minister) Narendra Modi leading the charge from the front, has much better chance of implementing reforms than say US President, Donald Trump. Commenting on the economy he said that central banks in emerging economies (EMs) such as India are much more responsible and educated about perils of money printing. RBI’s former governor Raghuram Rajan & present governor Urjit Patel have done a good job in stabilising the rupee. Indian market is up 13 percent in local currency and in dollar terms, the market is up close to 18 percent led by a rise in the rupee. The currency is very important for foreign investors. A strong currency can pull foreign investors towards India, he said. “I remain constructive on India and over the next 10-20 years, India has the potential to grow at 5-7 percent each year – which is huge compared to growth rate seen in the US or Europe,” said Faber. India, according to PwC, in 20-30 years will become a second largest economy in the world similar to China.

 He also highlighted that only marginal amount of domestic saving find its way to Indian equity markets The wealthy families should at least put 20 percent of the money in Indian equities or Indian properties and direct investment because it is time to look forward. Today, US stock market is 53 percent of the global stock market capitalisation now. But, in 10-20 years, it will be reduced to 20 percent and India and China will hog lion share up to 50 percent, highlights Faber. You have repeatedly told us that you see more value in emerging markets compared to developed markets. But this has been your theory for a while now. Do you think that the story has played out or do you think that markets like India still have more stea maintained more than a year ago that over the next 5-10 years, India would outperform the US and other western markets. I think it is still a valid story. In general, you have a new government, Mr Modi who is trying hard to implement some reforms and he has actually a far better chance to implement these reforms than Mr Trump. Secondly, this is something that is very interesting for me as an observer of economic history. I think central banks in emerging economies such as India, as an example, are much more responsible and much better educated about the perils of money printing. Mr Rajan and Mr Patel have done a very good job so far in stabilising the rupee. In local currency, the Indian market is up something like 13 percent this year. But in dollar terms, the market is up close to 18 percent because first the stock market went up then the rupee went up. The stock market is not that important for the majority of Indians because it is only a minority that owns Indian shares.

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