Did the saving habit of the Indians stood them in good stead in this recession-hit period?
The downward plunge of the Indian stockmarket has hurt the fortunes of thousands of investors, big and small. It will also have broader implications for India\'s financial system and the future of savings and investment patterns. Over the past few years, cautious investors had started to diversify away from bank deposits and cash, moving into equities, mutual funds and insurance products. But the market turmoil is driving them back to the safety of bank deposits, reducing the amount of capital available to other instruments and possibly retarding the growth of the financial-services industry as a whole.
India\'s high savings rate has been a crucial driver of its economic boom, providing productive capital and helping to fuel a virtuous cycle of higher grow ...more