China’s stock market tumult is prompting some global investors to shift their equity exposure to India, Bloomberg News reported.
“The recent travails in China make India seem like an oasis of calm in terms of volatility,” Jonathan Schiessl, the head of equities at UK-based Ashburton Investments, was quoted as saying.
Ashburton, which oversees US$12 billion, is said to have cut its exposure to China by 1 percent in the past month to invest in Indian equities and raise its cash position.
“India is in a phase in which multiple engines of growth can drive GDP from 7-8 percent to 9-10 percent in the next five years,” Sukumar Rajah, chief investment officer of Asian Equity at Franklin Templeton in Singapore, told Bloomberg.
“For China, we expect growth to decelerate over the next few years partly because it doesn’t benefit from demographic trends the way that India does.”
Templeton is overweight India and underweight Chinese shares in Hong Kong relative to benchmark indexes, Rajah was quoted as saying.
India’s economy expanded 7.5 percent in the March quarter, beating China’s 7 percent growth.
The International Monetary Fund has predicted that India will outpace its neighbor in the current fiscal year.
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