How India transformed in less than a decade: Morgan Stanley shows in 10 points

India has gained positions in the world order with significant positive consequences for the macro and market outlook in a short span of 10 years.

India has gained positions in the world order with significant positive consequences for the macro and market outlook in a short span of 10 years.

In a report, 'India Equity Strategy and Economics: How India Has Transformed in Less than a Decade', penned by Morgan Stanley Research chief India economist Ridham Desai and his team, the brokerage highlighted the 10 big changes, mostly because of India’s policy choices, and their implications for its economy and market.

“We run into significant scepticism about India, particularly with overseas investors, who say that India has not delivered its potential (despite its being the second fastest-growing economy and among the top-performing stock markets over the past 25 years) and that equity valuations are too rich. However, such a view ignores the significant changes that have taken place in India, especially since 2014,” the report said.

The Morgan Stanley Research report has named the following 10 big changes:

1. Supply-side Policy Reforms

2. Formalisation of the Economy

3. Real Estate (Regulation and Development) Act

4. Digitalising Social Transfers

5. Insolvency and Bankruptcy Code

6. Flexible Inflation Targeting

7. Focus on FDI

8. India's 401(k) Moment

9. Government Support for Corporate Profits

10. MNC Sentiment at Multiyear High

Endorsing the government’s string of bold economic initiatives, the US-based firm mentioned that India's base corporate tax rate has stayed below 25 percent while for new entities with operations commencing before March 24, it has stayed at 15 percent.

Highlighting the infrastructure development, the study mentioned that national highways, broadband subscriber base, renewable energy and railway route electrified.