The recovery of private corporate investment in India can face more delays due to a weak corporate feeling triggered by the highest rates of the USA. UU. And the risk that China discharges excessive manufacturing capacity, according to a recent UBS report.
The report indicated that, although the consumption of households in India is expected to remain stable, the commercial perspective has become cautious.
He said that rural demand is likely to recover due to good crops, and urban demand is expected to stabilize when inflation and trimming of interest rates.
However, these positive national trends may not be enough to boost short -term corporate investment. He said: “There could be a delay further in the private recovery of Capex Capex due to a weak corporate feeling and the risk of China’s discharge.
“The report marked that companies doubt in investing in new projects, especially at a time when global conditions become more uncertain. It is expected to have the recent movement of the United States administration to impose higher rates. Significant implications. Significant implications.
The report estimates that if these rates remain in place, global commercial volumes could be reduced to 7.5 percentage points.
The report stressed that India’s property exports could also suffer due to the slowest global growth. However, he pointed out that India is relatively better positioned compared to many of her Asian classmates.
This is because India depends less on property exports and has a solid base in services exports, which currently represent about 47 percent of the country’s total exports. These service exports could help cushion the coup of world commercial interruptions.
The report has also reviewed its downward growth forecasts for the main economies. The US GDP growth projection for 2025 has been 1.6 % to 0.4 percent.
Meanwhile, the impact of American tariffs in China is expected to reduce the growth of letter export in 5 percentage points and GDP growth in 1.5 percentage points. The Nations of the ASEAN-5 could also see a fall of 0.7 percentage points in the growth of its GDP.
Despite external pressures, the report, however, believes that the macroconomic foundations of India remain solid and that the country’s long -term growth history is still intact.
More like this
Posted on April 15, 2025