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War and hate - Views on News from Equitymaster
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  • Jun 6, 1999

    War and hate

    There is too much hate in the world. And maybe it is an expensive thing to have around. Although the Indian stock market is bouncing back a bit from the Kargil effects, the foreign perception of India and Pakistan as a place to do business has certainly fallen by a few notches.

    Don't use the FII money inflows as a gauge of confidence. The FIIs are generally sattawallas with foreign passports and different dress codes. Don't forget that it was just one year ago that most of these FIIs operating in other Asian stock markets were telling us how Asia was a basket case and had pulled their money out big time from this continent. Now, of course, they are throwing money back in and telling us how Asia is, indeed, the land of milk, land, honey, and opportunity. The multinational companies are a better gauge of foreign interest in a country. And, yes, they are coming in to India but at a much slower pace than what even they would like to.

    Assuming we had a stable government and no "war" with Pakistan, our Index could be maybe 5,500. That is probably an addition of US$ 30 billion in wealth to our country (about 10% of our annual income as a nation). Consider how a 'love thy neighbour' policy would help reduce defence spending in the long run and allow more money for education of the people. A more educated people is generally a wealthier people. That would help push the positive economic effects even further. Add to this, if we had leaders who really cared about our country and its people...

    Aaah, but all of this wishful thinking. The reality of the situation is a lot different. India has many problems: internal and external. And unless we get someone up there who is willing to solve it as opposed to enriching their families, India will continue to be a trading market bouncing between despair and potential.



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