India is not just a consumer but has transformed into a key exporter of several goods and is playing a significant role in the global supply chain too. The country is on the path to become the world’s third-largest economy, outpacing Japan and Germany, by 2027, and will have the third-largest stock market by 2030, according to S&P Global and Morgan Stanley.
Along with different sectors including manufacturing, the prospects of India’s growth in the renewable energy space are also vast so much so that the country could fetch about $10 billion investment in 2023. Bank of America’s top executives in the country are bullish on India’s ability to attract deals and investments in the green energy sector.
The influx will be seen across areas like electric vehicles and green hydrogen, Bank of America’s president and India country head Kaku Nakhate has said in an interview with Bloomberg. As investors look to reflect the energy transition in their portfolios, India has high chances of seeing pour in the space.
“If you really have to get your ESG story right, and if you are into energy, then you can do large pieces of work in India,” Nakhate said.
Nahate credited the Indian government’s clear targets to achieve net zero carbon for the belief that investors are showing in India. Investors and companies attending the bank’s recent North American roadshow were impressed by this, Nakhate told Bloomberg.
“People take us seriously. That’s why we are seeing more sustainability funds that want to invest in India,” she noted, adding that the lender will continue to build out its distressed debt financing business in the renewable energy sector, which has generated double-digit returns.
Not just green investment, but India could also witness a rise in dealmaking in consumer brands, which are boosted by rising per capita income and spending. “If you want to play the India story, you will want a mix of brands to enjoy the distribution story,” Nakhate opined.
In addition, India, with its democratic traditions and robust domestic market, is well suited to draw investments and could have an edge over the so-called friend-shoring by companies that are rethinking their supply chains, disrupted by Covid and the Ukraine war, Nakhate opined.
Meanwhile, the North Carolina-based bank doesn’t plan to recruit a notable number of employees in India. It is worth mentioning here that investment banks worldwide have cut back on staff and bonuses. While Morgan Stanley has cut 2% jobs globally, rival Golman Sachs is also reported to be laying off about 400 employees.
