India This Decade

India's digital payments industry has been growing rapidly, with the market expected to reach $10 trillion by 2026. This growth can be attributed to the Government of India and the Reserve Bank of India's efforts to promote digital payments, the advent of FinTech, and Payment Service Providers or PSPs building infrastructure for seamless transactions. One of the most significant developments in this space is the Unified Payments Interface or UPI, which is estimated to account for about 90% of total transactional volume in retail digital payments over the next five years. UPI has been instrumental in driving financial inclusion and transforming India's payment landscape. Another essential component of India's digital payment ecosystem is India Stack, a unified software platform aimed at bringing India's population into the digital age. India Stack is the largest open API in the world and has enabled financial inclusion for 80% of the population in just six years. As we move forward, let's take a closer look at the key players in the Indian digital payment space and how they are shaping the industry.

The Indian digital payment space is dominated by several key players such as paytm, phone pe, google pay, amazon pay. Paytm has a market capitalization of $5.61 billion as of May 2023. Paytm is one of the leading players in the digital payment space. The company's current revenue is $1.05 billion. Next, we have PhonePe which is valued at $12 billion in April 2023. PhonePe is another major player in the Indian digital payment market. The company leads the mobile payments market on UPI, with a market share of 47% as of January 2023. Then, we have Google Pay. Although Google Pay's market share has fallen to about 34% in January 2023 from 36.3% in January 2021, it remains a significant player in the digital payment space. Google Pay had an annual run rate of $110 billion transaction value in 2019. Next in this list, we have Amazon Pay. As a subsidiary of Amazon, which has a market capitalization of $1.448 trillion as of September 2023. Amazon Pay is another key player in the Indian digital payment market. These companies have been making significant investments to tap into the booming digital payments market in India. They have not only expanded their businesses in digital payment services but also introduced innovative solutions to cater to the diverse needs of the Indian population.

Indian Railways is the largest rail network in Asia and the world's second-largest under a single management. With increasing urbanization and rising income levels, the demand for rail services is growing in both urban and rural areas. In fact, India is projected to account for 40% of the total global share of rail activity by 2050. To meet this growing demand, Indian Railways is investing heavily in infrastructure and technology. From April 2000 to September 2022, FDI inflows in railway-related components stood at US$ 1.23 billion. By 2030, rail infrastructure is expected to see an investment of Rs 50 lakh crore (US$ 715.41 billion). This investment will help improve services, increase revenues, and ensure the safety of operations. In FY 2022-23, Indian Railways registered record revenue figures of ₹2.40 trillion, which is nearly ₹49,000 Crores more than the previous year, reflecting 25% growth. The organization operates 13,523 passenger trains and 9,146 freight trains daily, with a total track length of 126,366 km and 7,335 stations.

Now that we've covered the growth and projections of Indian Railways, let's move on to our next segment, industry analysis. Indian Railways is continuously innovating and developing new technologies to enhance its services. For instance, 15,000 km of the rail network is being converted into automatic signaling, and 37,000 km will be fitted with 'KAVACH,' a domestically developed Train Collision Avoidance System. The government has also allowed 100% FDI in the railway sector, which will further boost investments and technological advancements in the industry. In January 2021, the Ministry of Railways rolled out a new iron ore policy governing the allocation of rakes and transportation of iron ore. Indian Railways has set a vision for 2024 to achieve targets of 2024 MT freight loading. The Mumbai-Ahmedabad high-speed rail project has been sanctioned at a total cost of $14.27 billion. The railway sector aims to electrify the entire network by 2023, leading to annual energy savings of $1.55 billion

Welcome to today's podcast episode, this is your host Amaya. And today we'll be discussing the recent inclusion of the African Union (AU) as a permanent member of the G20, a group of the world's richest and most powerful countries. This significant development took place at the request of Indian Prime Minister Narendra Modi, who hosted the G20 Summit.

The African Union is a group of 55 African nations, representing approximately 1.4 billion people and around 10% of the world's economy. Until now, Africa had only been marginally represented within the G20 through South Africa's seat. With the AU's inclusion, the G20 will now have more than 20 members, marking the end of the G20 as we know it.

You might be wondering why the African Union should get a G20 membership and why India is championing this cause. The African Union has been a permanent guest at the G20, along with 12 other organizations like the United Nations, ASEAN, the IMF, and the World Bank. However, being a permanent guest does not provide the same level of representation as full membership.

Africa is home to 1.4 billion people, about 17% of the world's population, but the continent has just one full member in the G20: South Africa. This lack of representation is even more apparent when compared to Europe, which has five G20 member countries and the European Union itself. The inclusion of the African Union as a full member will not completely undo this disparity, but it is a start towards just representation.

India's push for the inclusion of the African Union aligns with its commitment to being the voice of the global South. The decision to include the AU as a permanent member of the G20 has received positive responses from various countries.

In an interview with the Nigerian Foreign Minister, Yusuf Maitaw Maktougal, he expressed optimism about the inclusion of the African Union and the importance of having a voice at the decision-making table of the largest economies in the world. He also emphasized that there is more to discuss at the G20 Summit than just the conflict in Ukraine, and that the theme of "one world, one family, one future" should guide the conversations.

The inclusion of the African Union as a permanent member of the G20 marks a new era of representation for the African continent. It is a step towards just representation and a more inclusive global decision-making process. As the G20 evolves, it will be interesting to see how the African Union's membership impacts the group's discussions and decisions in the years to come.

Welcome to the India This Decade podcast, an in-depth exploration of one of the world's largest and most exhilarating economies, India. I'm Amaya, your host, and I'll be accompanying you on this captivating journey. Our aim with this podcast series is to provide essential knowledge for investors who are looking to scale up their investments or venture into the Indian economy for the very first time. We hope that by the end of this series, you'll have a much clearer understanding of why India should be a top priority for your future investment considerations. Throughout this podcast, we'll be engaging in conversations with prominent figures in Indian business to learn more about the country's remarkable growth. We'll be delving into the significance of India's trajectory towards becoming the world's third-largest economy by 2027 and beyond. Please be aware that the thoughts and opinions shared by our hosts and guests are their own, and they, their employers, or partners may have stakes in the equities discussed in this podcast. This podcast is intended for informational purposes only and should not be used as the sole basis for making investment decisions. 

In today's episode, let's embark on an exciting journey through the thriving Indian economy, showcasing the myriad opportunities and possibilities that lie ahead. Whether you're a seasoned investor or just starting out, India should undoubtedly be on your investment horizons. Did you know that a recent report by Morgan Stanley suggests that India is on the verge of unprecedented economic growth, driven by three megatrends? These megatrends include global offshoring, digitalization, and energy transition. India is already the fastest-growing economy globally, with an average GDP growth of 5.5% over the past decade. The report forecasts that India will overtake Japan and Germany to become the world's third-largest economy by 2027 and will have the third-largest stock market by 2030. India's GDP could more than double from $3.5 trillion today to surpass $7.5 trillion by 2031. The Bombay Stock Exchange, or BSE, could deliver 11% annual growth, reaching a market capitalization of $10 trillion in the coming decade. 

This economic boom could lead to significant changes, such as increasing India's share of global manufacturing, expanding credit availability, creating new businesses, enhancing the quality of life, and fueling a surge in consumer spending. Morgan Stanley's Chief Equity Strategist for India, Mr. Ridham Desai, believes that India's idiosyncratic changes imply a once-in-a-generation shift and an opportunity for investors and companies. To further support this India growth story, let's examine some additional statistics. Total Foreign Direct Investment inflows in the country in FY 22-23 amount to about $70 billion, and total FDI equity inflows stand at about $46 billion. Honorable Prime Minister Shri Narendra Modi announced a special economic and comprehensive package of more than $270 billion, equivalent to 10% of India's GDP, under the Atmanirbhar Bharat Abhiyan (Self-reliant India). India is expected to witness GDP growth of 6% to 6.8% in 2023-24. Demographically, India is becoming home to the largest youth population in the world. India has the third-largest group of scientists and technicians globally. By 2030, it is estimated that around 42% of India's population will be urbanized, up from 31% in 2011. That concludes today's episode. In our upcoming episodes, we will delve into these aspects in greater detail. Stay tuned for more insightful episodes from India This Decade. Thank you for listening, and don't forget to subscribe and share