JPMorgan is bullish on India and Japan, a top Asian official was quoted as saying by Reuters

By Swati Bhatt

MUMBAI (Reuters) – JPMorgan, the biggest U.S. bank, is bullish on India and Japan in Asia but also wants to allocate resources to Southeast Asia, which benefits from its “China Plus One” strategy, an official from high rank at said bank.

“India is still firmly in the top three, possibly top two in Asia, along with Japan. The growth in India is actually very broad,” JPMorgan Asia Pacific CEO Sjoerd Leenart said in an interview on Monday.

“We are investing on all fronts in India. We are adding bankers, investing more capital in businesses and building capabilities such as technology investments to serve new market segments,” he added.

JPMorgan expects its commercial banking business, which focuses on mid-sized companies, to grow by up to 30 percent in India over the next few years, Leenart said.

India should further build its manufacturing ecosystem and ensure scalability to gain from the ‘China Plus One’ strategy, which has now largely benefited Southeast Asian countries, he added.

China Plus One is a strategy that companies follow to diversify investment and supply chains from China to other countries.

“In India, the next stage will be to a degree to become a manufacturing hub, to create blue-collar jobs, and that’s an opportunity, but it’s almost a necessity for India,” Leenart said.

“So if this strategy doesn’t work, then India might not do as well as people expect. That’s probably the hardest to execute,” he said, adding that he still expected India to succeed.

On Japan, Leenart said, with interest rates now positive, clients have become interested again and from a corporate activity and rates perspective, the country is full of opportunities.

JPMorgan’s business in China has grown significantly and Leenart said despite concerns about slow economic growth there, the country cannot be ignored.

“We’re actually very excited about what we have in China. We have all the capabilities and are looking to maximize the opportunity we have with domestic and international clients. He actually grew up nicely.”

JPMorgan is looking to invest in Southeast Asia, where the size of the combined economies is about $3 trillion, making it almost as big as India, Leenart said.

“Obviously it’s a bit more difficult to navigate because it’s fragmented across five or six countries, but that’s a place we’re keen to invest in.”