Drivers of Growth
Challenges
Summary
Size and Distribution of Savings
1993-94
1995-96
1997-98
1999-00
2001-02
1993-94
1995-96
1997-98
1999-00
2001-02
Sources: RBI
Opportunities in life insurance
Life in s u ra n c e p re m iu m a s % o f GDP
12.0%
10.7%
8.0%
5.7%
6.0%
4.4%
4.0% 3 .4 %
2 .3 % 2.3%
2.0%
0.0%
UK Jap an Ko re a Aus trlia US Ma la y s ia Ind ia China
Opportunities in non-life insurance
5 .0 % 4 .6 %
4 .0 % 3 .5 % 3 .4 % 3 .4 %
3 .0 %
2 .2 %
1 .8 %
2 .0 %
0 .9 %
1 .0 % 0 .6 %
0 .0 %
US UK Aus tra lia Ko re a Japan Ma la y s ia China Ind ia
Retail credit opportunity…
Co ns u m e r lo an s / GDP (%)
60
55
52
50
40
33
30
20 18
10 8
0
Ko re a Taiw an Malay s ia Thailand India
Net retail NPA levels are low at about 1.6% for the Indian
banking sector as a whole and even lower for many of the
leading players
Opportunities in asset management
60%
40% 30%
23% 21%
20% 6%
0%
Aus tralia US Brazil UK Ko re a India
Opportunities in Credit Card
Current Scenario
Drivers of Growth
Challenges
Summary
Twin Growth Drivers
Demographic Transition
Economic Development
Lowering Dependency Ratio …
…leading to growth in Household Financial Savings
Reducing dependency could trigger a self-reinforcing savings growth dynamic in the next decade
No. of
HH (M)
120
90
141 <70k -2.31%
60 123
30
0
'03-'04 '09-'10(E)
Income range based on 1998-1999 prices
Demographic Transition
Economic Development
Drivers of development…
Globally-positioned IT sector
• Software exports of US$ 12.2 bn in FY2004 and US$ 7.1 bn in
H1-2005
GDP 8.5
Source: NAS
Renewed industrial growth
After a prolonged period of restructuring and repositioning
growing competitiveness
• Increasing deployment of technology
• Deleveraging and organic capital generation
• Constantly improving quality standards
S -c u rv e fo r in c o m e g ro w th in As ia
25,000
GD P p e r c a p ita in 2 0 0 3 (U S $ )
Ho ng Ko ng
20,000 S ing a p o r
Jap an
15,000 Ta iw a n
Ko re a
10,000
Ma la y s ia
P hilip p ine s
5,000 Tha ila nd
Ind ia China
0
0 10 20 30 40 50 60
Ye a rs fro m s ta rt o f re fo rm s
S o u rc e : M o rg a n S t a n le y
Current Scenario
Drivers of Growth
Challenges
Summary
Challenges of Intermediation in India
Size of the country and dispersed affluent population
Pay hikes
• Salary increases grossly out pace inflation
• Projected increases to continue at a minimum 10-12%
Evolving Regulatory Environment
Multiple Regulators
Drivers of Growth
Challenges
Summary
Summary
Strong growth prospects for the Indian Economy