AKIPRESS.COM - India’s economy is not only withstanding global headwinds well, but also seems to be emerging as the beacon of hope for global investors. Known for being a market that provides long-term gains, India has also benefited from the reforms that Prime Minister Narendra Modi-led NDA government has been slowly, yet steadily introducing, reports The Financial Express.

Globally, analysts, brokerages and rating agencies are of the view that India will continue to grow steadily, if the government keeps taking more steps to boost the economy. Many have acknowledged that economic reforms and government initiatives have begun to show results.

Moody’s thumbs up for Make in India: Moody’s Investors Service has lauded the government’s ‘Make in India’ initiative, stating that the push for domestic manufacturing will go a long way in attracting FDI inflows.

“FDI inflows are likely to climb further in response to government measures, such as efforts to liberalize foreign investment limits in several sectors and the ‘Make in India’ initiative,” says Marie Diron, a Moody’s Senior Vice President for the Sovereign Risk Group.

Net FDI inflows into India hit an all-time high in January 2016, at $3.0 billion on a 12-month moving average basis. India’s current account deficit (CAD) is now more than covered by its FDI inflows. “The rise in FDI points to stronger investor interest in India on the back of robust economic growth,” feels Moody’s.

The rapid rise in FDI inflows mitigates the risks related to a possible widening of the current account deficit from weaker remittances by diminishing India’s external financing needs from other inflows in the form of credit and equity inflows, says Moody’s.

“The development of industrial corridors, investment and manufacturing zones, and ‘smart cities’ will further bolster investment inflows. In particular, flows into the manufacturing sector are likely to accelerate as the government seeks to boost the sector’s share of GDP to 25.0% by 2022,” says Diron.

Carlyle is long on India: The world’s second largest private equity fund, Carlyle, has ranked India as the most attractive investment destination in the whole world, offering the highest expected returns on incremental capital over the next four years, according to a newspaper report.

In a first-of-its-kind note to its investors, specifically on India, Carlyle’s director of research Jason Thomas has said after India formally assumed the mantle of the world’s fastest growing economy in 2015 from China, it will continue to outpace the later by about 1% this year and the gap between the growth rates of two is likely to widen over time.

“The reform agenda proceeds, albeit at a slower pace than many observers initially contemplated, and new monetary policy targets have reduced the risk of a confidence-sapping rise in inflation that hits financial savings and the currency. India’s hour on the global macroeconomic stage has arrived. Investors should take notice,” Thomas said according to the business daily.

IMF confident of industrial & investment revival: With strong growth and rising real incomes, the International Monetary Fund (IMF) sees India as a bright spot in the world economy. At a time when the it has revised the world growth forecast for the current year, the IMF is confident about the economic prospect of India.

Driven by private consumption and increased industrial activity, India’s growth is projected to notch up to 7.5% in 2016-17, overtaking China’s GDP by more than 1 per cent, says IMF.

Growth will continue to be driven by private consumption, which has benefited from lower energy prices and higher real incomes, feels IMF. With the revival of sentiment and pickup in industrial activity, a recovery of private investment is expected to further strengthen growth, it adds.

Fitch on structural reforms: Fitch Ratings also expects India to be on the top of the global growth ladder and expanding by 7.% in the current fiscal, a shade higher than the estimated 7.5% in the previous year due to higher disposable income and a likelihood of a normal monsoon.

The gradual implementation of the structural reform agenda, Fitch Ratings said, is expected to contribute to higher growth, even though progress is lacking so far on big-ticket reforms such as the Land Acquisition Amendment Bill and the Goods and Services Tax.

“Implementation of legislative reforms has so far been difficult, given the government’s limited support in the senate (Rajya Sabha), but executive reforms continue to be rolled out.”

It said the Budget for FY17 contained some further announcements of reforms, including measures related to the FDI regime, the financial sector and agriculture, illustrating that the government continues to gradually broaden its reform agenda.