Global headwinds are likely to slow down India’s GDP growth, but the country is more resilient than many large economies. India has enough tailwinds with political stability, vaccine security, food security, a robust domestic consumption-based economy, digitisation initiatives and a robust regulatory system for the financial sector, HDFC chairman Deepak Parekh said.
“India is not immune to the global shocks but has proved to be more resilient than many large economies. For sure, India’s GDP growth will slow down because of global headwinds,” he said.
For startups, he said, “many investors still have plenty of dry powder for good, innovative ideas, but the days of cash burn and high valuations are behind us”.
Entrepreneurship in India has exploded because of the conducive startup environment in the country and India has the third largest number of startups after the US and China, Parekh said.
“In the recent period, geopolitics has dominated over geoeconomics with spillover impacts on trade, services, technology, capital flows and even in the mobility of the labour force.
“There is immense distrust amongst countries at a time when we most need global cooperation to solve common pressing issues like global supply chains, global warming, cyber threats, money-laundering, data privacy, responsible use of artificial intelligence amongst several others,” he said.
Parekh further said that the other critical global issue of the Western world has been the sudden change from years of quantitative easing and negative interest rates to a sharp rise in interest rates to combat inflation.
“This has resulted in a cost of living crisis across many advanced economies. In India, based on RBI’s policy announcement, we are lucky to have finally got a pause in the rising interest rate cycle,” he added.
(Input from PTI)
