With economists forecasting India's economy to grow by 7 percent during the fiscal year 2004-2005, the country is seen as catching up with China to become a major consumer of raw materials and influence over commodities markets.
"Will India be the next China for commodities?" Barclays Capital analyst Kamal Naqvi wrote recently in a research note to clients.
"This is one of the questions that we are being asked most often at present. The answer is probably no, or at least, not yet. However, considerable potential does exist."
With annual GDP growth of 9 percent since 2003 and some 1.3 billion inhabitants, China has played a key role in raising the price of commodities traded on world markets.
Oil, metals, cotton, rubber, sugar, grains, wool -- all are sought by China in large quantities and the slightest change in its demand for such products can have a major influence on price direction.
India, which also boasts a population of more than 1 billion people, is yet to wield the same influence over commodities as its Asian neighbor, but for many analysts it is only a matter of time before it catches up.
"It is clear that in one or two decades, the trading landscape will change in tandem with these two countries' evolution," Refco analyst Philippe Pesque said.
"They are the world's two biggest demographic powers and which have the most unbelievable rates of growth. In a generation, if there are no hitches, their impact [on commodities] will be very spectacular," Pesque added.
Investec analyst Bruce Evers said there was "huge scope" for the gap between India and China to narrow.
"The Indians are incredibly entrepreneurial," he said.
"There is a rapidly growing middle class who are making a lot of money through setting up their own businesses, and this access to new money is enabling them" to consume.
India has contributed largely to soaring Asian demand for hard commodities, such as oil and metals, during the past two years.
It is by far the world's biggest consumer of gold, representing about a fifth of global demand. The precious metal is bought in bulk in the form of jewelry that is offered as gifts on the occasion of marriages and the country's various festivals.
"Gold is a big part of Indian life and as people get richer they'll buy more gold jewelry," Evers said. China is the world's biggest consumer of platinum jewelry.
India accounts for only 2 percent of world copper demand compared with 22 percent by China, which is ahead also regarding crude oil. China accounts for 8 percent of crude compared with 3 percent by India.
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