India isn’t just another BRIC in the wall

Image: Reuters/Arko Datta
We may earn a commission from links on this page.

Five years ago, when North American investors would think about putting their money in the BRIC economies, India was towards the bottom of the list. But now Asia’s third largest economy is attracting much more money—and investors are becoming increasingly bullish.

Between December 2014 and January 2015, JP Morgan surveyed 30 investment professionals in North American firms that together have $1.6 trillion in equity assets. And an overwhelming number of them said they viewed India as a positive investment destination.

And here’s where they want to put their money.

But surprisingly, India’s booming technology space topped the list of sectors the investors want to keep out of. Part of the reason is because India’s technology sector is largely export-oriented, and a strengthening rupee could cause problems.

North American investors also weren’t quite bullish about equity trading in India. This is largely due to the complex procedures and the time it takes to register foreign institutional investors in the country. The survey noted that even in smaller emerging markets, such as Thailand and South Africa, there are fewer restrictions on foreign capital.

Overall, the usual suspects came up when investors were asked to list the challenges of doing business in India.