Isn't constant growth a good indicator of future prospects?
It's slowing down, though. It's not even remotely enough to catch up with any developed nation.
In the last decade the country has been attracting in excess of $50bn and more annually. This does not make the news but its there. So long as this country continues to offer better returns than elsewhere the FDI will continue. Future projected growth will guarantee it.
The FDI increase was mostly due to silly after-COVID policies China employed. That heavy inflow of FDI wasn't because India suddenly became the hotspot. It was because China didn't want that money.
Anyway, as you may be aware, China walked back on those silly policies to promote its industries recently.
Result?
the net FDI (inflows minus outflows) declined to just $1.18 billion during April-December 2024 from $7.84 billion in the same period in 2023.
The world is watching those numbers, and they don't like the Indian economic outlook. It's why China's share market is up by like 30-40% and India is still falling. The fall in the Indian market has not much to do with Trump or Nasdaq. It was falling before his antiques.
Also some points in your opener are incorrect. Take for example what you said about exports. Important no doubt but not as important as it is for export dependent countries like say China.
India has an internal economy meaning 70% of its wealth is internally generated and this has been the case for over half a century now.
But for China this figure is less than half. Without exports the Chinese economy contracts 70% whereas for India it is only 30%. So India is the more resilient of the two
I don't agree. We are export dependant. More so than China.
India is imports dependant. We can't grow petrol, technology, or dollars here. We simply won't function without our imports. Agree on this point?
Say, your monthly expense is 2L. But, the salary is only 1L. Can you say you aren't concerned about the salary?
China is a net positive economy. Just because an economy is a net positive doesn't mean it must rely on the exports, or it'll flop. China is resourceful, which India can't claim. China has resources for almost everything. If the world collapses tomorrow, it can survive rather thrive on its own just fine.
China is thriving with its exports, no doubt. But India is collapsing in slow motion under its import heavy trade portfolio.
We can only claim India isn't reliant on exports if we stop talking about the newest phones, laptops, cars, and fuel, and go back to using bullock carts. Today, our salary (exports) doesn't cover our expenses (imports).
However, we can't be so sure about the future as AI lowers the barrier to entry for tech startups. India has a booming startup ecosystem, and AI can help small businesses scale rapidly.
AI is for startups for now in India or elsewhere.
Then
1. why do Indians choose to open their AI startups outside India?
2. Why the whatever AI startups India has got are nothing short of scams (eg krutrim)?
Some startups using the same AI could make into Fortune 500 etc.
Sure. I have 0 doubts. But can it happen in India?
India is only country whose 70% population is under 35 years while chinese population is now having more older people than young.
Chinese population has been decreasing drastically for the past 5 years from 1.5 billion to now 1.25 billion while Indian population is increasing at a drastic rate.
In my opinion, like I said in the OP, In a few years, it won't matter who's got a younger population, and what's the birth rate. Machines will take over the blue-collar jobs.