ABSTRACT

Over the past five years, average gross domestic product (GDP) growth of 8.75 per cent has made India one of the world’s fastest-growing economies. Domestic and foreign investors have flocked to the country’s booming stock markets and have been eager subscribers to a steady stream of record-breaking initial public offerings (IPOs). This rapid growth has brought significant dividends to the population at large, as well as to emerging market investors: the poverty rate has fallen from 36 per cent in 1994 to less than 28 per cent in 2005, inflation has been contained and the current account deficit is moderate (IMF, 2008).