Despite bank fraud, this $40-bn fund manager finds India as surprise haven

'The extremely positive environment for investing in Indonesian banks or Brazilian consumers in 2010, 2011, 2012 -- that's where India could go in the next few years,' James Syme

James Syme is putting his money on India, unfazed by a bank fraud scandal, a planned government tax on equity holdings and short-selling that’s hit a record high.

Stocks in India have potential for a significant rally, even as many emerging-market stocks look unattractive amid rising global rates, Chinese growth headwinds and expensive valuations, said Syme, a London-based money manager at JO Hambro Capital Management, which oversees about $40 billion.

"The Indian economy resembles a coiled spring waiting to be released," Syme said in an interview in New York. "Even if the Fed does four hikes or the middle part of the