New Govt Improved India's Perception: DBS

The government is facing growing pressure to deliver on growth and reform. "Improvement in the perception towards India and renewed confidence are the most notable changes over the past 12 months,"

"From broad mistrust, markets have drawn confidence from the new administration", it said.

Prime Minister Modi's efforts to forge stronger ties with strategic global partners have also provided an "open-for- business" image, noted DBS.

While policy makers get some of the credit, favourable externals - low commodity prices and ample liquidity - have also helped.

Domestic reforms have been broad-based and incremental. Crucial areas were identified, including urbanisation, financial inclusion (broader public access to banking facilities), infrastructure and a bigger role for manufacturing.

While things are headed in the right direction, a mismatch between initial expectation and outcome has led to disappointment, the DBS said.

The improvement in confidence brought $42 billion of foreign capital inflows into Indian asset markets in 2014.
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