India released data showing it remains one of the fastest growing economies in the world. But can it fill the void being left by a slowing China? Ivor Bennett reports.
As one dragon slows, another emerges. Chinese new year celebrations in India offered a handy allegory for the fortunes of Asia's two economic powerhouses. India's 7.3 percent growth in the last quarter putting China's 6.8 percent in sharp relief. BGC's Mike Ingram. SOUNDBITE (English) MIKE INGRAM, MARKET ANALYST, BGC PARTNERS, SAYING: "I always hesitate to suggest that economies can decouple. I'd be no great believer in developed markets decoupling from emerging. But India - events on the ground and policies put in place justify taking a bullish stance on the Indian economy." That stance was certainly on display at the Indian Auto Expo One of the fastest growing car markets in the world contributing to annual growth forecasts of 7.6 percent. But behind the glitz and glamour are causes for concern, says Ingram. In particular the recapitalisation of India's banks. SOUNDBITE (English) MIKE INGRAM, MARKET ANALYST, BGC MARKETS, SAYING: "We all know from our European history, our recent European history, that that is a very dangerous thing to do. You need to do that properly because a country can't have sound economic growth without a sound banking system." There are other worries too. Merchandising exports have been falling for 13 months, corporate order books are flat, and with factories running well below capacity, there's no hurry to invest. The Chinese believe the year of the monkey will bring good fortune and financial prosperity. An apt omen perhaps, and not just for them.