Ken Griffin is one of the most knowledgeable hedge fund managers in the world. His job, and the job of his company, Citadel LLC is to find “diamonds in the rough” when it comes to investing in foreign assets. That’s not an easy job, but Griffin has been doing it for so long he usually doesn’t miss a beat when it comes to identifying the next big “investment diamond.” For the last several years, Brazil and China have given investors some above average returns, but those days are over for now. Griffin thinks the brightest spot in the cloudy global investment horizon is India. India hasn’t always been the darling of foreign investors. But today, India is being called the brightest light in the global growth race by economists as well as investors. Mr. Griffin knows that this is a special moment for India, and he wants to be a big part of the investment bubble that is developing throughout the country.
Mr. Griffin on an insidermonkey.com article said it is quick to say that India still has some hurdles to overcome. It is the second most populated country in the world, and there are millions of poor people in cities all over India. But economic growth is on the way to reaching 7.2 percent by the end of 2015. That’s way above the other BRICS countries, and about 3 percent better than the economic growth in the United States. The International Monetary Fund predicts a 7.6 percent increase next year, and that will surpass China’s growth in 2016, according to Griffin. The IMF also thinks India’s economy will be better than Germany and Japan’s economic growth by 2019.
Inflation is under control thanks to the tumbling oil prices, and the Reserve Bank of India has cut interest rates, and that has helped the country support the growth and maintain price stability. Griffin also thinks the new government has played an important role in getting the attention of investors. Modi’s budget opened the door for foreign investors, and hedge fund managers like Griffin have reacted to his ideas.
Modi’s budget includes plans to correct the infrastructure issues, reduce the deficit, create more jobs and develop a working framework for the country’s central bank, and Griffin knows that means investment profits in the future. For the first time in years, the India budget is not just a 12-month plan. It’s the beginning of a long-term solution. Some investors still think India will have another “big bang moment” in the future, but Griffin says India’s leader understands the nature of capitalism. The government will follow a slow, consistent and steady roadmap in order to embrace foreign investors, and transform the nation into a consumer driven market.
The company has more than $26 billion assets under management, and India is playing an important role in giving the company’s limited partners excellent present and future returns.