India to sustain high growth rate despite global headwinds: Expert
New Delhi, June 27
India is expected to remain among the world's fastest‑growing major economies despite geopolitical tensions, uncertainty around artificial intelligence spending and sustained foreign investor outflows, Seth R. Freeman, Senior Managing Director at GlassRatner Advisory & Capital Group, has said.
Among Indian market sectors, Freeman remains constructive on healthcare and automobiles, as being well positioned for long-term growth, the report from NDTV Profit said.
Freeman said recent underperformance in Indian equities should be seen against the backdrop of extraordinary global developments rather than a deterioration in India's economic fundamentals.
"There is a lot of volatility caused by the war and AI‑related investments are soaking up global liquidity," he said, adding that India continues to achieve high growth and that trajectory will be sustained.
He noted that domestic investors have cushioned the impact of foreign institutional investor (FII) outflows this year and predicted that overseas capital would return once valuations become sufficiently attractive.
Freeman believes that periodical flare ups will occur related to the United States‑Iran conflict, and investors should not expect a quick resolution. Supply disruptions linked to the conflict could reduce the availability of fertilisers, potentially driving food prices higher globally, he noted.
He also mentioned artificial intelligence as a major theme reshaping global capital flows, and massive investments being made in AI infrastructure, data centres and semiconductor manufacturing.
Freeman, however, cautioned that returns on those investments could take several years to materialise. He also dismissed concerns that the recent correction in semiconductor stocks reflects a structural downturn, the report said.
He attributed downside in semiconductor stocks to elevated valuations and persistent supply constraints.
Meanwhile, Goldman Sachs has raised India's GDP growth forecast to 6.8 per cent for calendar year 2026 from 6.5 per cent earlier, following the US-Iran peace deal that has led to lower global oil prices and eased supply chain disruptions.
The investment bank has also raised its FY27 GDP growth forecast for the country by 40 basis points to 6.5 per cent.
— IANS
Reader Comments
Good to hear about healthcare and automobile sectors being well-positioned. But I wish the article also addressed how common citizens will benefit from this growth. What about job creation for our youth? The inflation and food price concerns mentioned are real challenges. Even with high GDP growth, many families are struggling with rising costs. Let's hope this expert's optimism translates into tangible improvements on the ground.
I've been following Indian markets closely. Freeman's point about AI investments soaking up global liquidity is spot on. The massive capital flowing into data centers and semiconductors is reshaping everything. While the short-term volatility is concerning, I believe India's demographic dividend and policy reforms will keep us ahead. The real test will be how we navigate the US-Iran tensions and supply chain issues he mentioned. Fingers crossed! 🤞
Nice to see international experts backing India's growth story. But I'm a bit skeptical about the timeline - Freeman says returns on AI investments could take years. Meanwhile, we need immediate solutions for employment and infrastructure. Also, the fertilizer supply disruption from US-Iran conflict is a genuine concern for our farmers. Hope our government is preparing contingency plans. Growth is good, but sustainable and inclusive growth is better.
The Goldman Sachs forecast increase from 6.5% to 6.8% is significant, especially considering global headwinds. The US-Iran peace deal lowering oil prices is a positive for our import-dependent economy. Freeman's balanced view - acknowledging volatility while affirming India's fundamentals - gives me confidence. Healthcare and automobiles are indeed strong bets. Let's hope overseas capital returns soon as predicted! 🇮🇳🚀
V Varun X