The Indian economy looks set to grow at a robust pace during 2015 despite a gloomy global economic outlook. The Indian government recently revised upward its growth projections for the FY2014/2015 to 7.4 percent, using a new GDP calculation method. For the FY2015/2016, the government projects that the economy will advance 8.0 percent.
That bright economic outlook would be supported by two growth engines, i.e., domestic consumption and public spending. In addition, improving economic stability should be conducive to implementing measures to bolster growth. The government's reforms, aimed at addressing structural problems, plus efforts to quicken strategic ties with leading nations, will also help support long-term economic growth.
Although Thailand's export share to India remains moderate at about 2.5% of our total, favorable Indian economic growth will likely bolster our outward trade there ahead, notably industrial products, e.g., chemicals, plastic pellets, copper, automobiles, auto-parts/components, air conditioners/components, electrical appliances/components, plus electronics and parts. These products should be needed by India as part of supply chains in the manufacturing of machinery, equipment/parts, as well as those supported by increased foreign direct investment (FDI), e.g., automotive and electronics items that are thriving there, as well as many government infrastructural development projects.
Meanwhile, Thai consumer product exports will perform well in India, too, e.g., cosmetics, soaps, skin care products, plus fresh and processed food products, thanks to growing purchasing power and increased FDI towards the Indian tourism and hospitality industry.
As a result, we at KResearch expect that Thai shipments to India during 2015 will expand about 6.5-8.0 percent to perhaps USD5,980-6,060 million, continuing from 2014 that grew 8.36 percent on a low 2013 base.