Even as the global economy faces a slowdown, emerging markets like China and India have been placed at the top a list of destinations offering exciting growth prospects for privately held businesses (PHBs) in a recently released report. Compared to advanced economies that are forecast to grow at 1.3 per cent in the next two years, the economies of China and India will register a growth rate of over 6 per cent for the same period, the report showed.
Grant Thornton’s report, titled International Business Report on emerging global markets, showed that China and India stood out as emerging markets with the best opportunities. Riding on a wave of positives like their current GDP growth rates, investment climate and substantial trade opportunities, China and India were slotted as the two most favoured destinations for investment and development. Russia trails at number three, Mexico at four and Brazil at five.
The study also reveals the presence of 22 other rapidly growing global economies, which offer immense opportunities for future growth. These include Malaysia, Indonesia, Iran, Pakistan, Thailand and Poland, among others. The emerging markets index is produced using a weighted calculation of key indicators, including GDP, population, international trade and growth projections. Citing the reasons for attractiveness of these countries, Grant Thornton India national markets leader Monish Chatrath said, “Emerging markets offer great potential for growth in a global economic slowdown scenario. Availability of low-cost yet highly educated labour force with strong work ethics, combined with fast industrialisation, technology deployment and a strong focus on infrastructure development is enabling these countries to close the gap with the more affluent and relatively slower-growing mature economies.”
According to recent projections, China’s economy would move ahead of the US by 2027, India would catch up with America by 2050 and BRIC (Brazil, Russia, India and China) nations, as a group, would surpass the G7 by 2032. “India’s position in the second place comes as no surprise.
The Indian economy has consistently been riding high on waves of growth since the 1990s and the current scenario has been characterised by an almost insatiable enthusiasm for technology, openness to global trade and tangible progress towards fiscal consolidation,” Chatrath added. The report also highlights the growing number of challenges in emerging markets. PHBs, in particular, face challenges given that the contemporary business environment is now global in nature and these businesses cannot operate domestically without reference to foreign markets.