Amid global economic woes, ‘Dr Doom’ Nouriel Roubini bats for India’s ‘rising power’

New Delhi: Economist Nouriel Roubini, who correctly predicted the 2008 financial crisis, has now prophesied that “India is going to be a rising power in the next few years”. In an interview to CNBC TV18, Roubini, who has earned the moniker Dr. Doom, said: “India and a few other emerging markets might be a good place to invest, both fixed income and equities.” “India among emerging market is certainly a positive one,” Roubini said. “It (India) has high real rates and reasonably stable monetary policy fighting inflation. Fiscal policy could be better, but it is okay. The structural factors go in favour of India,” the economist said, adding that India’s potential growth runs seven per cent, may be higher with economic reforms. His comments come within days after he said in an article in The Guardian that India is set to become the world’s most important country in the near term. He also observed that the country’s economy has “enormous scope for productivity gains.” De-dollarisation Since the end of World War II, the US dollar has been the global reserve currency, however, gradually, the currency is losing its sheen after several countries have started following the trend of de-dollarisation. Most countries are settling overseas trade in their local currencies. As many as 18 countries, including Russia, UK, Israel, Malaysia have been trading with India in Indian rupee, or INR. Also Read: US banking crisis not over, more to go bankrupt soon, warns ‘Doctor Doom’ Nouriel Roubini Also, China’s yuan has replaced the US dollar as the most traded currency in Russia. Brazil and China are also trading with each other in yuan. This would help establish the Chinese renminbi (RNB) as an international currency and dollar challenger. BRICS nations are also in the process of creating a new currency to facilitate trade. It is reported that the new financial agreement could be seen as soon as in August when the countries - Brazil, Russia, India, China and South Africa - meet for their annual summit in South Africa. See India being closer to US than China Roubini said he sees India becoming closer to the West geopolitically in the future. He said that China has been strongly proposing yuan as an alternative to the US dollar. “Gradually the global economy is headed from a unipolar to a bipolar reserve currency system and it is because of this he sees India allying more with the West,” Roubini added. Must Read:  Indian rupee could be the new dollar, says ‘Doctor Doom’ Nouriel Roubini “In that system, I see India as closer to the West and to the dollar, rather than being close to the RMB,” the economist. But why? Roubini explained that China and India are strategic rivals, they have border issues. “It’s true that India right now may need oil, energy, food, and fertilisers from Russia, but that dependency can change over time. And I see the future of India, a geopolitically member of the Quad being closer to the US and the West,” he said. Roubini believes that one major factor that will play a crucial role in India’s economic growth is the concept of “friend-shoring.” “It (India) is going to benefit from a friend-shoring. Money is going to be moving out of China because of the risk of China; it is going to move to places that are much more friendly to the West. One of them, given the industrial and tech base, is going to be India. So, I assume that India is not going to be part of that de-dollarisation process,” he said. Don’t Miss: Severe recession likely next year, economy headed into a ‘Bermuda Triangle’ of financial crisis: Nouriel Roubini What is friend shoring? Friend shoring or ally shoring refer to the practice of companies relocating their operations to countries that are seen as friendly and stable. Through this strategy, a country sources the raw materials, components as well as manufactured goods from nations that share its values. Also, the reliance on the countries considered a “threat” to the stability of the supply chains is gradually diminished. Read all the  Latest News ,  Trending News ,  Cricket News ,  Bollywood News , India News  and  Entertainment News  here. Follow us on  Facebook,  Twitter and  Instagram.