Indian economy a victim of Modi govt's shock therapy, says Chris Wood

Wood expects the government to continue to announce measure to prop-up the economy, but remains mindful of the widening fiscal deficit

The Indian economy is a victim of Narendra Modi government’s shock therapy since he assumed power in 2014 and conservative investors can assume that it may take four quarters more for it to rebound, and be pleasantly surprised if the recovery comes earlier, wrote Christopher Wood, global head of equity strategy at Jefferies in GREED & fear, his weekly note to investors.

That said, his base case remains that the reforms, be it demonetisation, the introduction of goods and services tax (GST), the Real Estate Regulation Act (RERA) or the bankruptcy law, will prove long-term positive. 

“There is no doubt