In 2014, India was the world’s tenth-largest economy. In the following seven years it grew by 40%. Among the big economies only China did better, with 53% over the same period. Growth this year by 8% will be the highest among big countries, according to the IMF. It predicts that by 2027 India will be the world’s fifth-largest economy, with a GDP of roughly $5trn at market prices. Underpinning this growth is a crucial logistics network.
The national highway network is over 50% longer than it was in 2014 (it also uses a digital tolling system to avoid queues). The number of domestic air passengers has doubled; air-freight volumes are up by 44%. There are more than three times as many mobile-phone base stations, supporting 783m broadband subscribers. Wall Street private-equity firms are competing to create networks of warehouses across India.
India’s top 20 firms earn 50% of corporate India’s cash flows. They are making money fast enough to take risks with their earnings instead of having to borrow to excess. The ambitious giants include conglomerates—Adani (energy, transport), Reliance Industries (telecoms, chemicals, energy, retail), Tata (it, retail, energy, cars)—and more focused giants such as jsw (mainly steel). Those four firms alone plan to invest more than $250bn over the next five to eight years in infrastructure and emerging industries; in doing so they intend to develop local supply chains, which fits with government goals. Mukesh Ambani of Reliance says he will cut the price of green hydrogen to $1 per kilogram by 2030, for instance, from about $5 today. Tata is rolling out battery plants, electric vehicles and semiconductors. These are huge, risky bets that few other firms would dare take.
