Gujarat Poll May Force Modi To Turn Focus on Jobs: TCG Advisory
By Santanu Chakraborty
(Bloomberg) — The Gujarat election contest, which was closer than some expected, may force Prime Minister Narendra Modi’s government to shift to pro-employment policies with a focus on infrastructure, according to TCG Advisory, which oversees about $3 billion of assets.
Government will probably stick to FY18 fiscal deficit target of a 3.2%, though a small miss is possible, Chakri Lokapriya, Chief Investment Officer at TCG, says in phone interview
Deficit miss won’t hurt bonds much as long as next budget includes “pro-business policies,” steps to speed up infrastructure projects
Government may consider deficit range of 3.2% to 3.5% for FY2019
Bullish on selective infrastructure stocks, chemicals, petrochemicals, refining, textile stocks
NOTE: Sharp selloff in Indian stocks gave way to a rebound as vote counting from Gujarat elections suggested Prime Minister Modi’s party would win more seats than early trends had indicated.