We Are Becoming A Nation Of...: HDFC AMC’s Navneet Munot On India’s ‘Multi-Pronged Growth Model’

The rapid pace of economic reforms by the government, including tax cuts, GST (Goods and Services Tax) reductions and liquidity measures by the Reserve Bank of India (RBI), has created a wave of optimism about India’s growth trajectory, according to Navneet Munot, Managing Director and CEO of HDFC Asset Management Company (AMC).

He lauded the government's economic strategy, describing it as a combination of "policy prudence, agile execution and effective communication" that sets India apart on the global stage.

“India has been a nation of savers for generations. What we are doing now is becoming a nation of investors. If you are astute, you would take a long-term view of India. It is going to be a multi-pronged growth model rather than a very narrow set of growth models most of the other countries have seen,” he said during a conversation with NDTV Profit on Friday. 

He said that India has become 'Atmanirbhar' (self-reliant) in its capital markets, while acknowledging the importance of the inflow of foreign funds. “I won't say that we don't need foreign savings. I think our investment needs are humongous. We need more foreign flows for sure. And at some stage, it's likely to come both in the form of FDI as well as in the form of FPI.”

He contrasted India's approach with that of major economies like the United States, highlighting a fundamental difference in philosophy.

“On one side, you are seeing increasing tariffs and putting more burden on the consumers... On the other side, what India is doing is, I want to give more benefit to the larger section of the society," he said.

He described this as the 'Bahujan Hitai, Bahujan Sukhai' (for the welfare and happiness of the masses) philosophy, starkly different from policies that favour tax cuts for the wealthy while imposing tariffs that ultimately hurt consumers.

Munot cited recent measures like personal income tax relief, GST rate cuts and RBI’s liquidity injections as steps to stimulate consumption and credit growth.

“It is not only about cutting rates and paying less taxes. It's also about like Chanakya said that the government should take taxes the way a butterfly gently takes nectar,” the top executive said.

Munot was bullish on India’s potential to produce global-scale asset managers akin to Blackstone or BlackRock.

“Several of those businesses are managing hundreds of billions in alternatives and trillions in public markets. Over a period of time, as this economy grows from $4 trillion to $40 trillion in our lifetime, you will see asset managers in India talking about that size,” he said.

Highlighting India’s importance for the world, he said, “This is where 18% of humanity is. This is where the youngest population in the world is. We will be the biggest supplier of labour force to the world for the next several decades. So, you have to ensure that you take full advantage of that demographic dividend.”

Shares of HDFC Asset Management Company closed 0.44% higher at Rs 5,594 apiece on the NSE, while the benchmark Nifty50 ended 0.03% up at 24,741.