Indian economy has finally taken off, says veteran banker Deepak Parekh

US manufacturing, infra cos should invest more, says veteran banker

The Indian economy has finally taken off due to political stability and is currently one of the brightest spots in the world for investments, veteran banker Deepak Parekh said here today.

"I believe that India has finally taken off after being on the runway for a long time. This is evident from various indicators, such as our GDP growth rate, which has been twice the global growth rate for the last three years. With a growth rate of 6.6 per cent, we have the fastest-growing large economy in the world, offering numerous opportunities," Parekh said at the Milken Institute's event today.

 

Parekh pointed out that some American manufacturing and infrastructure companies have not yet invested in India, unlike their peers from Europe.

"It's surprising that corporate America has not yet fully leveraged these opportunities. While US private equity firms and fund managers have made significant investments in India, we need to see more direct investment from corporate America. I don't see enough American presence in infrastructure projects, such as airports, railways, and sports," he said.

"To change this, we need to improve the ease of doing business in India and make it more attractive for corporate America to invest and manufacture here. We must take responsibility for outreach and create a more conducive environment for American businesses to thrive. I hope this will be a key focus area going forward," he said.

Speaking earlier at the event, the US Ambassador Eric Garcetti said the US aims to establish a "best friends forever" (BFF) relationship with India, unaffected by changes in the White House administration.

Garcetti emphasised that India should reduce its dependence on a single country to counter regional competitors, citing economic and security risks. He encouraged American investment in India, highlighting opportunities during a time when five pension funds with $1.8 trillion in assets are exploring investment options in the country.

Garcetti described the US-India relationship as evolving from "complicated" a few decades ago to "definitely dating." He advised India to diversify its dependencies to reach full growth potential and contend with regional competitors. He cited examples of India's struggles with solar project machinery and medical equipment procurement during the pandemic, highlighting the risks of single-country dependence.