Wealth Outlook 2024 - Slow then grow

Asia: faster growth for 2024 as headwinds recede 110 Wealth Outlook 2024 | Regional outlook India: reforms and demographics support earnings and valuations In India, the big event in 2024, the general elections in April–May, is largely a foregone conclusion. Opinion polls show a comfortable margin for Prime Minister Narendra Modi and the ruling Bharatiya Janata Party. The opposition may have grievances with Modi’s social policies, but economic reform and development have been robust, including reducing the cost of interstate commerce, production-linked incentives, digitizing the finance sector and investing in the country’s famously awful infrastructure. In some ways, India is the mirror opposite of China, having developed its services sector even though it FIGURE 2 India’s demographic dividend is expected to last for another decade to 2033, with fewer and fewer dependents per 100 workers on average China India Dependency ratio (dependents per 100 working age population) 2040 2020 2000 1980 1960 2030 2010 1990 1970 1950 100 80 60 40 20 DEMOGRAPHIC DEFICIT DEMOGRAPHIC DIVIDEND Source: United Nations population projections, as of July 2022. All forecasts are expressions of opinion and are subject to change without notice and are not intended to be a guarantee of future events. may take hours to travel from one end of Delhi to the other. Now, with infrastructure investment rising, the country is in a good position to industrialize, while China’s recent struggles have galvanized global supply chain diversification. India is the largest economy enjoying demographic dividends. India’s dependency ratio (the number of children and seniors on average supported by every 100 working age persons) is 47 and likely to fall further to 45 by 2033 ( FIGURE 2 ), according to the United Nations. Put another way, there are more than two workers supporting each dependent. When China had a comparable demographic dividend in 2000–2010, its GDP growth averaged 10.5% annually. These demographic trends are one reason we’re confident Indian GDP growth can average 7–8% over the coming decade.