Speaking at an excellent day of talks at this year’s Mines & Money conference in London yesterday, well-respected Indian national and analyst Jayant Bhandari, had little positive to say about his native country, where he still spends about six months of the year. He describes the nation and its political system as inherently extremely corrupt, and this coupled with its sometimes unnavigable bureacracy, as a huge limiter on potential Indian growth prospects.

On the country’s gold monetisation scheme, he described this as a ‘scam for gullible people’ and does not see it as having an impact on the pattern of Indian gold consumption. He pointed to the tiny take-up of the scheme in its early days, suggesting that even the Modi Cabinet – whose members’ families are probably almost all substantial gold holders – has not felt it worthy of taking up. Indians will continue to accumulate gold he reckons as the other investment options open to people there are mostly effectively negative yielding, whereas gold has proved itself over hundreds of years as providing financial stability for the Indian populace.

When Narendra Modi came to power there was a huge amount of hype as to how he would transform the Indian economy and bring it into the 21st Century – and even ultimately replace China as the prime driver for resource sector growth. Bhandari has little time for Modi – describing him as a ‘fanatic’ and ‘dangerous’. Other Indians I have spoken to recently, including some from Rajasthan state where Modi is said to have transformed the state’s economy, also seem to have a poor opinion of his ability to do this for the nation, describing him as a consummate politician – all talk and no substance, but perhaps one should be more worried about Bhandari’s description above. However he does also have a substantial following, although how long he can stay in power in a democracy riven with factional and religious divides, obviously remains a potential worry for any progress that might be made.

With India being very much a bottom-up economic system with a government which, if at all, is reactive rather than proactive – the reverse of China, speakers at Mines and Money felt the chances of India taking up the resource sector demand slack created by the current Chinese economic reboot are at the very least unlikely to be accomplished in the foreseeable future. to read more on this do read India won’t replace China as top resources consumer.