India's markets are turning into an inexorable force
At least $1 trillion of government securities traded daily in the most populous nation and biggest democracy is poised to become the darling of international investors when India this year joins the benchmark for emerging-market debt compiled by JPMorgan Chase & Co. India's entry following Russia’s exclusion after Vladimir Putin's 2022 invasion of Ukraine (and 2014 seizure of Crimea) and when China's sovereign debt is losing its luster, will make Asia's third-largest economy a beneficiary of as much as $40 billion of inflows during the next 18 months, according to Goldman Sachs Group Inc.
How big a deal is that? Consider that foreigners, who are currently prohibited from owning more than 6% of India's sovereign debt, held as little as 0.4% last March, paltry by any measure of major developing countries.
Overseas investors will still have to contend with government policies that benefit from Russia's invasion of Ukraine, especially the purchase of Russian oil at discounted prices. Prime Minister Narendra Modi's government also is leading the expansion of the BRICS (Brazil, Russia, India, China and South Africa), who are committed to countering Western influence, curbing domestic dissent from the press and political opponents, and creating an alternative financial system that is less dependent on the US dollar.
But the prospects for rising demand for India’s debt couldn't come at more propitious moment for the world's No.
5 economy, whose gross domestic product rose 7.6% in the three months to September from a year ago, more than any of the economist estimates compiled by Bloomberg and much greater than the Reserve Bank of India’s projected 6.5%. The robust GDP report means India continues to be the fastest-growing
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