, Columnist
Modi's Profit Problem
Many of the companies on which Modi's drive depends just aren't profitable enough.
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The hype surrounding Prime Minister Narendra Modi's "Make in India" campaign hits a reality check right at the New Delhi airport. Operator GMR Infrastructure, which also runs power plants, is barely managing to earn an operating profit large enough to make interest payments. Hundreds of other companies, including infrastructure utilities and manufacturers, aren't that lucky. They're simply working for creditors.
Modi is asking foreign and local investors to make big-ticket commitments to take advantage of India's demographics, democracy, demand and deregulation. But the "4Ds" alone may not suffice. For companies that sell to businesses, there's no path to profit if their customers can't afford to make new investments.