A New India ETF

Wisdom Tree a fund management company has created a new ETF for India weighted by earnings. ( here is an article with explanation from IndexUniverse)

WisdomTree won the race to get the first exchange-traded fund to cover India to market today with the listing of the WisdomTree India Earnings Fund (NYSE Arca: EPI) - and it was some victory. The new ETF had a tremendous start in its first day of trading, with roughly 1 million shares changing hands.

I spent almost 3 years trying to build a derivatives trading operation in India. We were very bullish on the Indian market ( as the sensex went from 3000 to 13000) and felt there was a tremendous opportunity to make markets in single stock futures and stock options. We were right. We also never made a dime. Barriers to entry prevented us from ever making a trade. These barriers ranged from government limitations on foreign entities to exchange refusal to approve the use of sophisticated order entry software. Ultimately we were never able deploy all the talented young Indians we trained in their own markets and we closed down. But despite this I have never lost my bullishness on the Indian sotck market.

I have no sense of the timing for investing in India in the immediate global economic environment but I believe strongly that funds invested there will bbe enormously higher over the long term. The potential is enormous and the big risk is political. Government bureaucracy, protectionism and inertia create tremendous drag on the economy. Every time government relinquishes some control over an industry that industry explodes in growth and profitability. The dominant caste in Indian society has long been the government officials and that are reluctant to give up their regulatory chokehold and access to baksheesh, but, the merchant class and entrepreneurs are gaining influence. The most prosperous states are the ones where business is most unfettered. The populous has noticed and even the communist parties which control some states are becoming more business friendly.
Indian markets will be volatile but I believe they are in a 20 yer bull run.

two sites with info on Indian markets and links to other sites.
Galatime is Kaushik Gala"s blog.
MoneyYoga a site with links to inices and sectors of the Indian market.

Update: More info on new India ETFs from ETF Trends