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Hyderabad, May 6 - India and China have the potential of recording a 10-fold increase in private equity investment in the next decade but any slowdown in global economy could have an impact on this, according to speakers at a seminar at Asian Development Bank's (ADB) annual meeting here Saturday.
They hope that the private equity investment, which was $7 billion last year, could go up to $70 billion or even higher in next 10 years but said the governments would have to take necessary measures to ensure this growth.
Addressing the institutional investors' roundtable on 'China and India: what is their relative value proposition for private equity investors', Renuka Ramnath, Managing Director and CEO, ICICI Venture Funds Management Co. Ltd hoped the private equity investment in India which was $2 billion last years would go up to $25 billion in five years.
She said this figure could even go up to $35 billion if the process of privatisation was speeded up.
Fang Wang, Managing Director, Asset Management, CITIC Capital, said the growth in China would depend on how fast the government would move to remove impediments.
However, Clyde Prestowiz, president of the economic strategy institute warned in his keynote speech that this miracle in India and China was not sustainable in the present context of the global economy. He said with US' current account deficit reaching 7 percent of its GDP and the risk of the dollar falling dramatically, the global imbalance could hit the two economies as their growth was based on exports.
Prestowiz suggested that India and China should ensure domestic demand to sustain the current level of growth.
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