India’s Growth Story Yet to Fully Attract Global Investment Flows: Amundi

India’s expanding role in global economic growth is not yet matched by foreign portfolio or strategic investment inflows, according to Didier Borowski, head of macro policy research at the Amundi Investment Institute. Despite robust GDP growth, controlled inflation, and a credible path toward fiscal consolidation, foreign investors have remained cautious, shifting capital toward artificial intelligence opportunities and expressing concerns over potential trade tensions with the United States. Borowski noted that Indian equities are underrepresented in global portfolios relative to the country’s long-term prospects.

He emphasized that the investment case for India is structural rather than short-term, driven by strong domestic demand, favorable demographics, and reduced vulnerability to external trade shocks. Foreign investors reportedly net sold nearly $23 billion in Indian equities between January 2025 and early 2026, pushing allocations to decade-low levels. However, recent trade agreements with the United States and the European Union have begun to revive investor interest and are expected to support future foreign direct investment inflows.

Borowski also highlighted a broader shift in global asset allocation amid rising geopolitical risks and trade fragmentation, which could benefit emerging markets such as India. He noted growing appetite for emerging market debt as investors seek higher yields and diversification, especially as U.S. Treasuries lose some of their traditional appeal as safe-haven assets. India’s fiscal discipline, relatively stable currency, and inclusion in major global bond indices are expected to further strengthen capital flows into the country’s debt markets.

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