Washington: The venerable investor and Berkshire Hathaway Chairman and CEO, Warren Buffett, expresses optimism towards India. Leading the company’s yearly assembly on Sunday, the nonagenarian financier remarked on the multitude of opportunities present in India.
Responding to queries regarding Berkshire’s active pursuit of Indian prospects, Buffett, while abstaining from specifics, acknowledged the existence of untapped avenues in the region.
Berkshire Hathaway’s operational and investment framework revolves around acquiring and overseeing enterprises spanning diverse sectors. “In India, it is evident that ample opportunities abound within its confines, and the inquiry lies in whether we possess any unique advantages, whether through deep insights into these enterprises or established connections facilitating transactions of particular interest to Indian stakeholders,” articulated the experienced investor.
“One might venture to suggest that such endeavors could be pursued more vigorously by Berkshire’s dynamic management, given our burgeoning reputation across the globe and the captivating nature of our experiences in Japan. Consequently, uncharted territories and neglected niches may beckon in the Indian landscape,” he appended.
Alluding to a potential entry into the Indian market, he indicated a swift decision-making process in exploring opportunities within the country. Buffett underscored that Berkshire’s forthcoming leadership will determine its foray into Indian investments.
“We anticipate observing the strategic maneuvers of Berkshire’s upcoming leadership, and fortunately, the wait for such revelations is not protracted,” he remarked. Robust GDP growth forecasts, manageable inflation rates, political steadiness at the central governance level, and prudent monetary policies by the central bank collectively paint an optimistic portrait of the Indian economy in recent quarters.
During the October-December quarter of the fiscal year 2023-24, India’s GDP surged by an impressive 8.4 percent, further solidifying its position as the world’s fastest-growing major economy, poised to sustain this growth momentum.
India is poised to retain its status as the fastest-growing major economy in 2024, as per the latest projections from the International Monetary Fund’s World Economic Outlook. The IMF has revised India’s growth forecast for 2024 from 6.5 percent to 6.8 percent.
India’s economy expanded by 7.2 percent in 2022-23 and by 8.7 percent in 2021-22, respectively. Currently occupying the fifth position in terms of GDP, following the US, China, Germany, and Japan, India is projected to ascend to third place in the coming years.
Why does the billionaire hold India in high regard?
Unaware of the myriad possibilities India presents to global investors and conglomerates, Warren Buffett, Chairman and CEO of the global investment behemoth Berkshire Hathaway, must reevaluate a nation poised to claim the mantle of the world’s third-largest economy, boasting a GDP nearing $5 trillion.
Under the stewardship of Prime Minister Narendra Modi over the past decade, India has made substantial strides across various economic metrics, now ranking as the fifth-largest economy with an estimated GDP of around $3.7 trillion (FY24 estimate). A decade prior, the nation languished as the tenth-largest economy, with a GDP of $1.9 trillion (current market valuation).
According to the Finance Ministry, “This decade-long journey has been marked by a series of substantive and incremental reforms, significantly contributing to the nation’s economic advancement.” Buffett’s assertion that “in India, there are undoubtedly numerous opportunities” underscores the pivotal question of whether Berkshire possesses a competitive edge, be it through profound insights into local enterprises or established networks facilitating transactions deemed favorable by Indian stakeholders.
As Buffett contemplates potential entry points into the Indian market, the nation’s GDP growth trajectory approaches new heights, with sectors such as manufacturing and automobiles witnessing resurgence, and GST collections reaching unprecedented levels. Recent data from the Reserve Bank of India indicates early signs of GDP growth surpassing the 7 percent mark, a feat achieved during the 2020s before the onset of the pandemic.
Recent IMF data reveals that India’s per capita GDP surged from $635 in 2004 to $2,850 in 2024, now constituting 42 percent of the $6,770 benchmark set by its peer nations. A recent HSBC survey highlights India’s manufacturing sector’s robust growth in April, driven by sustained demand. Furthermore, despite global headwinds, India maintains its position as the world’s third-largest tech startup ecosystem, boasting over one lakh startups and over 100 unicorns.