India’s economy grew at a faster pace than most major nations in 2018, and this year, it’s poised to overtake the UK to become the world’s fifth-biggest.
But that journey won’t be smooth. The outcome of a general election due by May is a potential pitfall for a nation already battered by emerging market turmoil and a currency rout last year. Also, any attempts by the government to undermine the central bank’s freedom and raid its surplus capital may spook investors and carry damaging consequences for the economy.
Nomura Holdings Inc. estimates global growth will ease to around 2.8 per cent in 2019 from 3.2 per cent in 2018, led by a slowdown in China, and a moderation in the US and euro-area toward long-term trends. “As cyclical impulses become less favorable, we expect exports, manufacturing and the investment cycle to weaken” in India, Nomura analysts said.
