Opinion: Which industry will do now what IT did then?

The thing is a lot of rupees have been bought by paying dollars (the price of the dollar went significantly lower from 49-50 to 47-48). Such transactions are not normally done for a shorter term, ie, no one would bring in their money to short sell. They have p-notes for that!!

Having said that, there are a lot of expectations from the new govt. In my opinion, they should not overly spoon-feed the sectors of the economy who've only now started making losses (when they earlier have made killings) such as real estate- bailing out of companies in the US and stimulus packages worldwide have happened as the economy there was totally doomed and out. In india, this is not the case. As far as real estate is concerned, prices are not the problem. Lack of customers is the problem. Lack of buyers is the problem. In other sectors like steel & co, the businessmen could do without those chinese dumps- otherwise, they're fine.

What the govt should focus on are issues like domestic security, poverty eradication, provision of better basic services and employment; while providing a level playing field wherever possible. Industries like Shipbuilding, Biotechnology and Healthcare have the potential of putting Indian on the global roadmap- they have already been buzzing, but have not made any major, out of the box achievements if we compare to what IT has done to India. These three sectors, in my opinion can and will be the "next big things". Another major focus for the government should be R&D. R&D leads to innovations, and innovations lead to new products and services. There is huge scope for R&D in Shipbuilding, Biotech and Healthcare. India is yet to become the outsourcing hub for Shipbuilding that it can become. Lower costs and the R&D potential back my case. As far as R&D in (agri) Biotech and Healthcare is concerned, there has been a lot of noise in the previous decade; but there haven't been overly successful results. If you consider Monsanto- the $11 billion american biotech company, and you consider its Indian counterparts such as partner Mahyco, you would know the difference that lies and the potential in the field. Similar is the case with HC. If you know about the relationship between Pfizer’s growth and R&D, you would know what I mean. (And if you know about the love of major Indian pharma companies towards off patent drugs and the recently over hyped “generics”, you would be convinced of what I am implying!)

So, as an investor, where would you put your money? My suggestion would be the above discussed (albeit briefly) 3 sectors. Plus one. IT (Yup!) Why IT? E-Governance. The beauty about IT is that it is never short of newer avenues. The beauty about E-governance solutions clientele is that it is the government! There would be no Obama to churn out those Buffalo policies (that don’t go well with the Indian IT bull!). And there is immense scope in e-governance as well. Imagine putting a billion people on the mainframes! And it’s not just about the mainframes. Subsidiary and complementary e-Governance solutions has a long market potential as well. So while Shipbuiding, Biotech and Healthcare can do what IT did in the last decade, IT can further its advance and example in this decade!

Coming back to domestic security, poverty eradication, provision of better basic services and employment. The first point needs no elaboration. The second point - poverty eradication would actually come as a huge stimulus to the economy as the general consumer base would have grown manyfold. Employment is the solution and the NREG schemes are the benchmarks. The UPA govt has done its homework in the past 5 years, and knows what is to be done now. That’s the advantage of a good continuing government that actually wants to do something. And boy, we have another advantage. Dr. Singh- an economist as a prime minister in this hour (or should it be year, or decade, err.. time will tell) of crises!