Patna : One of the problems with India has been that Indians do not believe in their own potential. We always assign more weight to the experts from abroad. Even most of our intellectuals, economists, analysts, commentators, and opinion makers have been making the same mistake.
However, the foreign expert may also be wrong. I would like to give one recent example : Mr Christopher Wood, the veteran market analyst and head of global equity strategy at Jefferies, in an interview to ‘ET NOW’ on April 13, 2020, had said that – India is ideally coming to an end of a three-week lockdown. If it imposes another three-week lockdown, Indian markets will see another round of selloff in domestic equity market. He said that in such an eventuality, he would be surprised if equities do not retest recent lows again.
On that day – April 13, 2020 – the Indian NIFTY 50 was at 8928.85 at 9.59 am. The recent low of NIFTY had been 7511.1 on March 24, 2020.
India announced its lockdown, extended and further re-extended it in the following manner :
· First lockdown announced on March 24, 2020, to be effective from March 25, 2020, for three weeks, up to April 14, 2020.
· Second phase of lockdown – extended from April 15, 2020 to May 3, 2020 (19 days).
· Third phase of lockdown – extended from May 4, 2020 to May 17, 2020 (14 days).
· Fourth phase of lockdown – extended from May 18, 2020 to May 31, 2020 (14 days).
· Fifth phase of lockdown (only for containment zones) – extended from June 1, 2020 – ongoing – scheduled to end on June 30, 2020.
From the above, it is clear that the lockdown has been extended not once, but five times in succession, by the Government of India.
Yet, the NIFTY 50 has not retested the recent low of 7511.1, as predicted by Mr Christopher Wood. Rather, the NIFTY 50 touched a high of 10176 on June 3, 2020, as compared to 8928.85 at 9.59 am on April 13, 2020 – the day on which Mr. Christopher Wood had given that interview to ET NOW.
The purpose of the above example is not to prove any point, but only to show that even accomplished and experienced market veterans like Mr. Christopher Wood may go wrong in their predictions with regard to the Indian economy and the Indian equity markets. The point being made is that any foreign expert is not such an unfailing genius that all his / her predictions about the Indian economy and the Indian equity markets shall always come true.
The problem is, when their predictions go totally wrong, we do not raise questions. But whenever any prediction made by them comes true, the entire community of experts, commentators, analysts and media – all start telling us how the foreign expert had already predicted the event much in advance.
There is nothing wrong with listening to foreign expert and respecting their experience as well as expertise. The problem arises when we give up objectivity and stop questioning their logic / analytical models in the light of facts. We have to look at the facts. If they contradict the prophecy of an expert – whether Indian or foreign – the facts have to prevail and not the wrong prediction / analysis of the expert.
For this, we have to start looking at facts as evidence. We also have to have confidence in our economy and our elected governments – both at the Centre and in the States – because it is only these elected governments who can be held accountable. The experts are not accountable to the Indian citizen in the manner that our elected governments are.
Mr Christopher Wood is entitled to his opinion. But if something is put in public domain by such respected analyst / commentator, it should be analysed on the basis of correctness of the prediction. Otherwise, it dents the authenticity of the opinion of the expert.
We must have faith in ourselves and our elected Governments. Our policy makers and the implementation machinery are second to none in the world.
The Great India Success Story is unfolding. Please remember – this is not the India of yesteryears. This is a completely different India which wants to shape its own destiny and has the necessary will power as well as confidence to do so.