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Ongoing GDP growth looks like 2003-07 one
Capex cycle has more room to run; Current cycle driven by investment outperforming consumption, public capex leading initially, but pvt capex rapidly catching up: Morgan Stanley
Investment-To-GDP Ratio Expansion
- Urban consumer leading consumption
- It’s followed by catch-up in rural demand
- Market share in global exports rising
- Macro stability risks kept in check
New Delhi: India’s current world-beating economic growth rate on the back of an investment boom resembles that of 2003-07 when growth averaged more than eight per cent, according to economists at Morgan Stanley. In a report ‘The Viewpoint: India - Why this feels like 2003-07’, Morgan Stanley said after a decade of investment to GDP steadily declining, capex has emerged as a key growth driver in India.
“We think the capex cycle has more room to run, therefore the current expansion closely resembles that of 2003-07,” it said.
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