India is more of an elephant, he said. China can simply direct sweeping changes, but since democracy requires consensus, change happens a bit more slowly in such a vast and diverse nation. But this behemoth is clearly moving forward, and "nothing can stop India from becoming the third-largest economy in the world."
According to Singh, India has opted for growth and will do what it takes to handle inflation (especially food inflation), realizing that it will take many more years of rapid growth to fully lift the rest of the population out of poverty. Governments come and go, but at the end of the day, it's the entrepreneurs who will make this transformation happen.
"India is where the future is," said N.D. Desai of the Apar Group. He thinks China has a seven-year lead on India when it comes to economic transformation, but India has huge advantages. It's a young nation with an intellectually sophisticated workforce that can deliver services in English (in fact, it's home to the largest English-speaking population in the world). India has also found oil and gas reserves that will lead to greater self-sufficiency.
How should investors play it? Apollo's Sanjay Patel urged some caution about equities. "Valuations are very rich," he said. Most Indian businesses are family-owned, and while many of these firms are enjoying rapid growth, they don't want to dilute ownership by issuing equity. He also warned that there is more leverage in India than meets the eye. Patel believes that the best opportunities lie in distressed debt. India does not yet have a corporate bond market; that's another development that lies ahead.
Man Jit Singh of Multi Screen Media pointed out huge opportunities in media. Fifty-five percent of India's population is younger than 25, and they are voracious consumers of entertainment. There is still a very low penetration rate of TV in households, suggesting huge growth potential for broadcasters.
Despite all the exciting potential, India has some speed bumps. Man Jit Singh brought up corruption and pointed out that while India does have a strong legal framework, the courts are clogged. Someone can break a contact and say "sue me" because they know your case won't be resolved for 20 years. But the good news is that a younger generation of Indians won't accept delay and graft as a given anymore. These days scandals are being investigated, activists are protesting and there are more robust government efforts to root out corruption.
The current scandals dominating public discussions are "the death throes of old India," Singh said. He believes there's a "shining" nation on the way thanks to young people who think "India rocks."