India’s information technology firms may no longer be the “darlings” of the economy as they suffer from the subprime fallout, but that’s not such a bad thing, says Manisha Girotra, managing director and chairperson for UBS India. A healthy dose of difficult times may help diversify an economy that’s a little too in love with its outsourcing and technology titans, she told the told Reuters India Investment Summit on Thursday.
Rural development and rising investment in infrastructure will power economic growth in India to 10 percent over the next three years but the software and real estate sectors could suffer from a slowdown in the west and a rising rupee, Andrew Holland, managing director of DSP Merrill Lynch Ltd’s Strategic Risk Group told Reuters India Investment Summit on Wednesday. Holland, who has been in India more or less 10 years, expected the oil and gas sector to be one to watch and said power would get a boost from infrastructure spending.
Reliance Industries Ltd.’s Atul Chandra, president of the firm’s international oil business, says it would think big if it went shopping abroad. Chandra, who leads Reliance’s hunt for oil and gas business, told the Reuters India Investment Summit the country’s biggest listed firm has plenty of financial muscle if it wants to make an overseas acquisition.
While there’s a lot of nervousness about the global implications of a possible slowdown in the U.S. economy from the subprime crisis, India’s Tata Group has not seen a significant fallout from the credit crunch and does not expect it will have a big impact on its acquisition appetite. Alan Rosling, executive director at Tata Sons, the holding company of Tata Group, said on the first day of the Reuters India Investment Summit in Mumbai on Wednesday that it was difficult to know how the credit crunch was going to play out but Tata had a strong balance sheet and if it needed to finance deals differently, it would do so.