Taps Coogan – February 25th, 2024
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As the following chart from Michael Arouet highlights, India has overtaken China to become the largest destination for foreign direct investment:
India replacing China as the favorite for foreign direct investments in one chart pic.twitter.com/KrycWAvQyS
— Michael A. Arouet (@MichaelAArouet) February 25, 2024
We’ve been banging the ‘India’ drum for years and in that time India has become the fastest growing large economy, perennially among the best performing emerging markets for investors, and now the largest recipient for foreign direct investment. The perception of India as an exclusively low skill/capital ‘textiles’ manufacturing destination is fast becoming obsolete as all the world’s largest electronics manufacturers now make significant portions of their products in India (Samsung, Apple, Google, Sony, etc…).
China, on the other hand, is now embarking on the largest population and workforce contraction in modernity, is seeing essentially no foreign direct investment, is struggling with one of the biggest property bubbles in memory, and has a totalitarian Marxist dictator-for-life running the country.
While there is a compelling argument that Chinese equity markets made a significant low a couple weeks ago and may see strength in the medium term relative to that low, they have returned essentially nothing to investors over the last 15 years, a statement that will remain true even after a large rally.
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