Even though sentiments have turned very weak, we will actually see the benefits of all the macro improvements flowing to company level in 2016, says Anand Shah, Chief Investment Officer, BNP Paribas Mutual Fund.
"The benefits of low oil prices would start to show soon. So far the benefits have not reached us, as they were absorbed by the government. That would now show this year in the form of road construction, investment in railways and pay commission," Shah told Business Today.
He re-iterates that the biggest plus (for India) today is oil. Low crude prices help in fiscal deficit, and containing inflation. Low inflation, in turn, helps in boosting consumption. "Oil is the biggest stimulus we have got without us having to spend much," says Shah.
According to him, it takes a while before you change things. But if you do things right, you will benefit in the future because India still has its demographic dividend to be captured.
He feels the biggest factor that favours businesses in India is demographics. "As much as you want to emphasise that government drives the market, it is the demographic dividend that's favouring Indian businesses. The government can act as the catalyst by facilitating increase in consumption and investments," he says.
