The report underlines that in the coming decade, India’s domestic financial savings is 13 percent of GDP on average.
He said, “As a basis, as a basis, India’s domestic financial savings on average 13 percent of GDP in the next ten years (11.6 percent of GDP on average in the last ten years).”
The growth of financial savings will be translated into significant streams of various devices, which reflects the gradual changes in the home from physical to financial property.
Of the total streams, Goldman Saxes are expected to be allocated to long -term savings products such as $ 4 trillion, insurance, pension and retirement funds.
Strong flow is estimated in equity and mutual funds, approximately US dollars. Meanwhile, bank deposits are expected to attract about 3.5 trillion. The report states that the proportion of income increases and the financial system is reflected in the samples that appear in other countries. The traditional physical property such as real estate and gold prefers more financial property. The report expects three main savings in India. First of all, the current account will provide stable funds for the corporate capital expenditure cycle of India without physically increasing the deficit.
Secondly, it is likely to support a long-term bond market, which will help the anchor Long-End Sovereign Bond product. It can also be suggested to issue long-term semi-door or corporate bonds, which will help the financial supply of infrastructure.
Thirdly, the increase in financial savings will expand the retail participation in the capital markets and the demand for commercial wealth management services is expected.
The report states that the decisions of the people in the household to distribute their savings between financial and physical property depend on many factors including income, inflation, interest rates, risk preferences and access to the financial market.
In advanced economies, there has been a clear change towards financial property, families grow in pension funds, capital markets and insurance products.
However, in many emerging markets, a significant part of domestic savings is going into physical property such as real estate and gold. This shows the great potential of further financialization of home savings in India.
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