MUMBAI WILL EMERGE STRONGER

Mumbai, the commercial capital of India, comes under attack from terrorists yet again, at a time when the world’s second-fastest growing economy is seen by many analysts to be a critical part of the solution in fighting a global recession.

Mumbai is one of the world's top ten centres of commerce and contributes to about 5% of India's GDP and accounts for 25% of the industrial output, 40% of maritime trade, and 70% of capital transactions to the economy. Mumbai's per-capita income is Rs. 48,954 ($990) which is almost three times the national average.

“Mumbai is a very resilient city," says Bundeep Singh Rangar, Chairman, IndusView Advisors Ltd., the India-focused cross-border advisory firm. “Each time it’s been the target of a terrorist attack, it rebounds stronger and more resolute.”

Post the July 11, 2006 Mumbai train bombings, for example, as a show of investor confidence, the Bombay Stock Exchange (BSE) had rebounded, starting the day with the BSE Sensex Index up by nearly 1% in morning trade. Foreign investors also retained confidence, with the Sensex up almost 3% at 10,930.09 at the end of the day's trade.

India is set to register a strong growth of about 7.5% this financial year, a marginal drop from 9% that the country achieved last year when compared to emerging markets peer China that will drop to similar level from about 12% last year, its lowest since 1990, according to estimates.

This firm footing that the Indian economy finds itself in, has a lot to do with the contribution from Mumbai, its financial capital that brings 40% of foreign trade, 60% of customs duty collections, 40% of income tax collections, 20% of central excise tax collections, and Rs. 40,000 crore ($10 billion) in corporate taxes to the Indian economy.

This apart, the city hosts headquarters of a number of Indian financial institutions such as the Bombay Stock Exchange, Reserve Bank of India, National Stock Exchange, the Mint, as well as the corporate headquarters of many large Indian companies – including the three largest private sector companies Reliance Industries, Tata Group and Aditya Birla Group – and numerous multinational corporations. Most of these offices are located in downtown South Mumbai which is the nerve centre of the Indian economy.

Strategic Industries

Mumbai is home to Bollywood, the largest film making industry in the world; the Bhabha Atomic Research Center, which will see its role gaining significance once the Indo-U.S. civil nuclear deal comes in to force. Other prominent industry sectors in the city include aerospace, optical engineering, medical research, information technology, computers and electronic equipment, shipbuilding and salvaging, renewable energy and power.