India is currently one of the hottest countries in the world to invest in. Many experts in Asian economics expect India to surpass China as Asia’s power player within the next decade or so. The main reason for this is a population that is growing at a faster pace than the Chinese, and the fact that that population has a median age that is ten years younger than China’s and is getting younger everyday. The relative youth of India’s population, combined with its growing economy provides a great opportunity to invest in key emerging Indian sectors.
Construction
India is moving towards becoming a more urbanized country. There is a great need for infrastructure to house the growing population, especially the growing middle-class. Of even greater need is roads. Currently the roads in India are either terrible (marked with pot-holes that slow traffic to a crawl) or non-existent (many Indian cities remained unconnected by road). Great opportunity exists for investing in companies that will be competing for the lucrative contracts being handed out by the Indian government as they seek to modernize the country.
Energy
The growing industrialization of India has put a strain on the power grid. During peak periods Indian power companies are delivering 10% less power than is needed. The grid is also plagued by frequent blackouts and doesn’t even reach a quarter of the population (over 300 million people). There is a great demand for an upgraded power infrastructure as well as new sources of renewable power and that is why energy investments in India is a great choice for investors to spend their money.
Mining
India is not producing enough coal to satisfy the demands of its growing population. Surface coal has been tapped out, and now demand exists for underground mines and improved technology to increase extraction rates. Improved mine management software and mining equipment are needed greatly.
Discretionary Goods and Entertainment
The emergence of the middle-class in India has led to many consumers with discretionary funds that they can afford to spend on “luxuries” and entertainment. Currently over 10% of India’s 1.2 billion people fall into the middle-class, and this number is expected to more than double over the next five years. Indians are becoming more brand conscience and are willing to splurge on name-brand imported clothing and consumer goods. Opportunity also exists in the entertainment industry as there is a growing demand for movies, music, and video games.
Telecommunications
India has over 100 million internet subscribers, third-highest in the world. Where’s the opportunity you might ask? India also has one of the lowest internet penetration rates in the world, currently only 8.5% of the population has internet access. ISP and IT companies across the globe are working hard to grab a foothold in the Indian telecommunications market which is estimated to be worth over $50 billion, with the potential to be worth much more as experts predict as many as 900 million potential internet users in India, due in large part to the fact that half of its population is under 25 years old and more readily adaptable to new technology than older citizens.
