[FOUNTAIN]Elephant overtaking Korea’s slow dragonAlthough elephants might seem slow, they can run 50 kilometers per hour, twice as fast as humans. Elephants prove the efficiency of their weight through that speed and in India are worshiped as gods of wealth. Currently, the world stock market is paying close attention to India’s running elephants. Mumbai’s stock exchange, opened in 1875, has the longest history in the Asian region, having opened 3 years earlier than the Tokyo Stock Exchange, the pride of Japan.
Since it first opened 130 years ago, the market has been quiet. Recently the market topped its highest mark for four days in a row and the market price passed over $500 billion. This number is only tens of billion dollars short of that of Korea’s stock exchange.
The Indian exchange was born due to the U.S. Civil War of 1860. When America’s cotton production was disrupted by the war, Great Britain took notice of India. Mumbai soon became a base of cotton export and cotton producing companies’ stocks became the subject of investments. Large groups of stock brokers started to appear at the teller’s windows of banks. But the bubble burst 5 years later, and the brokers had nowhere to go. These jobless 318 brokers gathered under a banyan tree and started to trade stocks.
It had been called the Bombay Stock Exchange for over 100 years because Mumbai was called Bombay in the English way. When the governing Bharatiya Janata Party changed the names of major cities back to the old Hindu way, it was renamed Mumbai in 1996. Ganesh, India’s god of wealth who has the head of an elephant, is the most popular god in Mumbai. It could be a miracle from Ganesh, but the Sensex ― the Bombay Stock Exchange’s sensitive index ― passed 8000 points this month. It took 5 years to reach 7000 points after first passing the 6000-point mark, but only three months to go from 7000 to 8000 points.
This was possible because many foreign investors crowded to India, drawn by their belief in the future of the country. There are 600 million “Zippies” in India, a term that refers to the young generation that wears western-style pants instead of traditional Indian clothes. The Zippies are usually fluent in English and pursue high technology. This group is more threatening to Korea than China, as their major specialty is information technology.
There are predictions that an “Indian Shock” is coming, a shock that would bring results incomparable to those from the previous “China Shock.” The Indian elephant at bullet speed has already outperformed Korea in terms of GDP. No one has any idea how Korea, one of the four dragons of Asia, became a laggard, slower than the elephant.
by Yi Jung-jae
The writer is a deputy business news editor at the JoongAng Ilbo.