India Economic Outlook: Global markets may be entering a new phase of recalibration, and India appears to be “not even the first inning” of a potential foreign investor comeback, according to Ben Powell, Chief Investment Strategist for the Middle East and APAC at the BlackRock Investment Institute.
Speaking to ET Now, Powell struck an optimistic tone on global macro conditions, pointing to easing geopolitical tensions and a sharp correction in oil prices. “It really looks like things are improving… we are seeing the tankers start to flow,” he said, adding that lower crude is “extremely useful for India.”
For India, a major energy importer, the shift could be a critical tailwind. Powell said the country had “suffered by doing nothing wrong,” caught between energy shocks and concerns of missing the AI-driven global rally. But he rejected the idea that foreign investors have fully priced in India’s upside. “Not even close, no,” he said when asked if the so called “peace premium” was already reflected in valuations.
He added that recent foreign inflows may only be the beginning. “I think this is really not even the first inning of the recovery when we can see the foreigners come back,” Powell said, arguing that improving confidence typically becomes self-reinforcing as prices rise.
On sector leadership, Powell pointed to domestic cyclicals as likely beneficiaries if capital returns strengthen. “I think banks for sure,” he said, adding that construction and broader “Made in India” or self-reliance-linked sectors could also benefit as global supply chains fragment.
He also emphasised that India’s AI narrative is not about missing the trade, but about adoption. “The challenge for India… is how the Indian workforce can use this magical technology to become more productive,” he said, noting that BlackRock expects Indian companies to increasingly harness AI for earnings growth.
At the macro level, Powell acknowledged that global rates remain a headwind, but said India is relatively insulated due to stable inflation dynamics. “We need to be very careful picking our spots,” he noted, highlighting earnings resilience as the key driver for equity performance.
More broadly, Powell described AI as a powerful macro force but also inflationary in the near term, given heavy investment demands in infrastructure, chips, copper and data centres. That, he argued, keeps central banks cautious and reinforces the importance of selective investing.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money-related decisions.)
