Kasikorn Asset Management (KAsset) has identified India as one of the most favored markets for international investment, citing the country’s status as the world’s fourth-largest economy. The firm points to India’s strengths in technology, robust government support, and a sizable labor force capable of driving sustainable domestic growth.
In a recent analysis, KAsset delved into the outlook for the Indian market, examining potential risks from U.S. tariff measures as well as broader investment fundamentals. Despite the threat of higher U.S. import duties, the firm believes India’s economy remains resilient, with a solid overall performance and prospects for lower interest rates in the near term.
KAsset forecasts India’s economic growth (GDP) for 2026 to reach between 6.5% and 6.8%. Meanwhile, the Consumer Price Index (CPI) in September 2025 rose just 1.55% year-on-year, down from 2.07% in August—a figure marking the lowest inflation rate in eight years, and well below the Reserve Bank of India’s (RBI) 2–6% target range. This easing in inflation was primarily attributed to falling food prices, particularly in vegetables and legumes.
With inflation below target, KAsset anticipates the RBI will cut interest rates further in December 2025 to boost domestic demand and ease pressures from U.S. import tariffs—supporting an opportune environment for Indian equities. At the same time, trade tensions with the U.S. appear to be abating, as both countries are currently negotiating over import duties and are reportedly close to an agreement.
The talks focus on reducing imports of Russian oil and enhancing market access for U.S. agricultural products. If successful, India’s import tariffs could fall from 50% to just 15–16%, substantially easing trade friction and further underpinning India’s economic growth outlook.
Given these positive trends, KAsset rates the Indian market as ‘Overweight,’ citing the country’s resilient economic trajectory, sustained domestic drivers, and the likelihood of a resolution to U.S. tariff issues. KAsset concludes that the end of the year presents a strong window for adding Indian equities to portfolios, capitalizing on potential future growth.
