Morgan Stanley continues to hold a bullish view on the Indian economy, supported by strong short-term momentum and solid long-term fundamentals.Seth Carpenter, Chief Global Economist at Morgan Stanley, told CNBC-TV18 that India’s growth outlook remains robust due to both cyclical and structural drivers. “The Indian economy is clearly quite strong. And we have, as a research house, been bullish on the Indian economy for quite some time,” Carpenter said.
He noted that inflation in India appears to be under control, giving the Reserve Bank of India room to ease policy, especially with falling energy prices and a softer dollar. “It gives the Reserve Bank of India quite a lot of operating room,” he said.
Carpenter also pointed to the government’s supportive fiscal policy, highlighting infrastructure investments and a pro-business approach as key enablers of long-term expansion. “We think there’s a long way to run for this expansion,” he added.Looking ahead, Carpenter said Morgan Stanley remains “pretty constructive on the outlook for the Indian economy, both this year and for the next several years to come.”On the global front, he struck a more cautious tone, particularly on China, where growth remains soft amid a deflationary environment. “We haven’t seen the Chinese economy roaring back,” he said, adding that the outlook is likely to stay subdued.Carpenter warned that global trade is likely to slow down but emphasised that India stands to benefit from global supply chain shifts. “India is very well placed in that regard with a manufacturing ecosystem that is growing to take up part of that open space… in terms of global trade and global supply chains,” he said.
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