Too many regulations prevent Indian economic development
Mumbai (AsiaNews) - Jamie Dimon, the CEO of the financial empire JP Morgan, the largest and most influential American bank, had been in India recently to explore the chances of investments. Among those that received financial help from the USA government under the Troubled Asset Relief Program (TARP), JP Morgan is one of those that has already paid back in full the billion it had received.
In an interview to The Times of India he admitted that “the world went through a deep recession that was was worse in the US and Europe than in China and India.
“The world – says Dimon- is a very complex place. As an American, it gives me a great sense of comfort to see India and China doing well, because just imagine how dire things would have been if everyone was in a bad recession together. Coversely, if you are Indian or Chinese, you really want to see America recover quickly, because US is very crucial to the world economy”.
When the conversation turned to JP Morgan’s international ambitions, what are Dimon's plans for India? The answer was: “Regulations prevent us from doing many things in India, China and other parts of the world. We would like to have the opportunity to buy things in India and to be in the retail/consumer business here. It has outstanding potential for many years. Indian market could be -20 trillion in 30-40 years and there will be huge growth in demand for our services. The trick is to grow with the market and with Indian corporates”.
The interview continues revealing a certain irony: whilst now the industrialized world wants to increase regulations into the international money market, India is requested to remove regulations.
Could increased regulation drive down the economic growth? “The cost of capital could go up, and that will get passed on to the client. And if regulations get really stringent, it could drag down growth.”
He is of the opinion that risk is an essential part of the financial market.
And where do the opportunities for India lie? “India’s opportunities lie in developing India. And you seem to do a very good job.”
The last question is if he agrees that the world will increasingly walk on the legs of India and China? “No” he said promptly and a little bluntly. The world is becoming more and more complex and all the continents and all the nations are going to have their say.
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