“India’s Impending Economic Boom” blared a recent headline from Morgan Stanley. They proclaimed that India would be the 3rd largest economy in 4 years (by 2027) and have the 3rd largest stock market by 2030. It has been averaging 5.5% growth in GDP over a decade with global offshoring, digitalization and energy transition fueling the growth.
“Apple to shake up international sales operation to make India its own region” proclaimed another recent headline. Tim Cook is focused on India as the next big market after China and of course it is also moving lots of production from China to India.
India to top China as largest international market in 2023 according to Walmart CFO was a recent headline from the Economic times. All of these companies and many others obviously know something and my recent experience bears out their optimism.
I just returned from a business trip to India where I was meeting with some suppliers for some clients. Not having been to India since the start of the pandemic, I was very eager to see how India had fared. I still remember the early days of the pandemic when fear gripped all of us who had families and friends in India and were pretty convinced that we would not be seeing most of them ever again. I am pleased to say that India came through the pandemic far, far better than anyone every expected. Compare this to the neighboring country of China where COVID is still dominating the headlines, people are still dying by the thousands, entire regions are still being shut down and the economy is still in the grips of the pandemic. It is sad to see people being locked up forcibly and being quarantined(none of which happened in India being a democracy).
The airports in India are far, far better than any airports you will see here in the USA. Trying to get home after landing in Chicago was an absolute nightmare. Massive lines for immigration, huge crowds in a crowded place to retrieve luggage, 2 elevators with long lines for people having to go to another terminal (with all their luggage) to catch their Uber’s, two unisex bathrooms with only 1 functioning door between them-the airport in New Delhi was phenomenal in comparison.
The spread of EV’s in India is phenomenal compared to here. Many buses are electric as are the famous phut phuts and cars. Latest introduction was a 5-passenger sedan for less than $25,000, needs a charge for 5 hours on a regular household plug which will give you close to 300 miles – WOW!!! Hardly anyone carries cash anymore and the street food vendor accepts electronic payments over their cell phones. Highways are reducing travel times dramatically and opening up rural areas for economic development and bringing more and more people into the labor force. I went on a road trip and stopped on the highway at a highway stop that had at least 10 different very good restaurant options and was way, way better than the McDonald’s with a gas station that we are used to. India has one of the youngest demographics of a large economy.
While I am naturally biased, my advice to all of our clients has been to make sure that their Category Management strategies are actively considering India as part of their supply chain because they will be giving up competitive advantage to their competitors if they don’t. This will clearly be an ascendant period for the Indian economy and your supply chain strategy should take advantage of that.
