India's economy may still be trailing China's now but it can play catch up if the country opens up its financial sector more.

That is the view of some experts at an economic forum. They said the problem could be due to the lack of foreign capital inflows.

Last year, India recorded an 8.7 per cent increase in its GDP while China's economy grew at 10.3 per cent.

Experts explained this is because a few large businesses and conglomerates control a large part of the Indian economy and is unwilling to partner with foreign companies.

The gamechanger to that, for Song Seng Wun, economist at CIMB, is "a recession which forces the local player to bring in foreign partners as well. Otherwise there are no incentives for them to do so… companies will make the same profit and maintain the same structure".

India, which is behind the "Ironman" animation series, has the technology, the entrepreneurship and the brands.

These are the potential assets that experts believe can lead to strong GDP growth in India.

However, observers are generally not as bullish on India as they are on China.

JP Morgan expects India's GDP to grow at eight per cent this year, while economists polled by Bloomberg expect the other Asian giant to grow by 9.5 per cent.

Spice chairman Bhupendra Kumar Modi: "I had this regular chat with (Indian) prime minister Manmohan Singh (who) comes from (the) finance sector and is seen as a person of reform.

"But it is the finance sector he has reformed the least.

"So I think the problem with (the) Indian economy is that the finance sector is still under high control.

"The banks are not allowed to be open(ed) up, the money, people are not able to put back into the business, and still, we have a long way to go (in reforming) the financial sector".

Moreover, India's economy was liberalised in the 1990s, more than a decade later than China.

Experts said this means the Indian economy is now poised for accelerated growth if it mirrors China's growth path.

Singapore, geographically sandwiched between the two Asian giants, is looking to tap on the potential from both sides.

Senior Minister of State for Trade & Industry S Iswaran said: "India's need for the financing and development of infrastructure presents opportunities for collaboration between China and Singapore, in terms of capabilities and access to capital markets.

"In the context of Information Technology, the collaborative flow could well be the converse - with Indian expertise combining with Singaporean market knowledge".

If its financial sector opens up further, experts said one key opportunity is the vast Indian SME market - where there is a high demand for loans.

India's economy may still be trailing China's now but it can play catch up if the country opens up its financial sector more.

That is the view of some experts at an economic forum. They said the problem could be due to the lack of foreign capital inflows.

Last year, India recorded an 8.7 per cent increase in its GDP while China's economy grew at 10.3 per cent.

Experts explained this is because a few large businesses and conglomerates control a large part of the Indian economy and is unwilling to partner with foreign companies.

The gamechanger to that, for Song Seng Wun, economist at CIMB, is "a recession which forces the local player to bring in foreign partners as well. Otherwise there are no incentives for them to do so… companies will make the same profit and maintain the same structure".

India, which is behind the "Ironman" animation series, has the technology, the entrepreneurship and the brands.

These are the potential assets that experts believe can lead to strong GDP growth in India.

However, observers are generally not as bullish on India as they are on China.

JP Morgan expects India's GDP to grow at eight per cent this year, while economists polled by Bloomberg expect the other Asian giant to grow by 9.5 per cent.

Spice chairman Bhupendra Kumar Modi: "I had this regular chat with (Indian) prime minister Manmohan Singh (who) comes from (the) finance sector and is seen as a person of reform.

"But it is the finance sector he has reformed the least.

"So I think the problem with (the) Indian economy is that the finance sector is still under high control.

"The banks are not allowed to be open(ed) up, the money, people are not able to put back into the business, and still, we have a long way to go (in reforming) the financial sector".

Moreover, India's economy was liberalised in the 1990s, more than a decade later than China.

Experts said this means the Indian economy is now poised for accelerated growth if it mirrors China's growth path.

Singapore, geographically sandwiched between the two Asian giants, is looking to tap on the potential from both sides.

Senior Minister of State for Trade & Industry S Iswaran said: "India's need for the financing and development of infrastructure presents opportunities for collaboration between China and Singapore, in terms of capabilities and access to capital markets.

"In the context of Information Technology, the collaborative flow could well be the converse - with Indian expertise combining with Singaporean market knowledge".

If its financial sector opens up further, experts said one key opportunity is the vast Indian SME market - where there is a high demand for loans.

channelnewsasia.com