The IMF has described India as a ‘bright spot’, ‘bright light’, which is ‘sure to leave a mark on the world’. Furthermore, domestic investors have held fort despite the prolonged spell of heavy selling by FIIs (foreign institutional investors) for nearly one year.ĭuggad explains the outperformance is driven by strong corporate earnings growth over the past two years, resilience of Indian stock markets, and macroeconomic management by the government and the central bank. Most global equity markets fell between 20 percent and 25 percent in the current calendar year. If equity returns is a benchmark, then India did outshine most peers in local currency terms. “India has emerged as a shining star in this calendar year with healthy outperformance amid varied global headwinds on macros, inflation, rates, currency and geopolitics,” says Gautam Duggad, head of research, institutional equities, Motilal Oswal. Several analysts and fund managers Forbes India interacted with are of the view that India will continue to outperform its peers. Despite the grim outlook, India is the fastest-growing large economy in the world, and the jury is out on whether the country has decoupled from the world. The impact of the Russian invasion of Ukraine, a cost-of-living crisis stoked by stubborn inflation, and the slowdown in China have hit the global economy. The World Bank has cut its forecast by 1 percent to 6.5 percent, and the Citigroup has reduced it to 6.7 percent from 8 percent earlier.
‘A weaker-than-expected outturn in the period of April to June, and more subdued external demand’ have prompted the IMF to slash India’s FY23 GDP estimate to 6.8 percent from 7.4 percent earlier. Most global banks and agencies have downgraded their growth outlook for India to below 7 percent. RBI fights daunting challenges with another 50 bps rate hike
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