India Tops KKR’s Global Radar for 2025 on Reforms, Resilience, and Domestic Demand

India has been named a standout investment destination by global private equity major KKR in its 2025 Mid-Year Global Macro Outlook report. The firm highlighted India's resilience, robust domestic consumption, policy reforms, and relative insulation from global trade shocks as key factors positioning it as a compelling bet amid mounting geopolitical and economic uncertainty.

India's Stability and Reform-Led Growth

According to the report, titled "Make Your Luck", India stands out in a world that is transitioning from decades of stable globalisation to a new era of geopolitical rivalry and fragmented trade. Despite rising global tensions—including US tariffs on over 60 countries and a general retreat from open trade—India has retained its macroeconomic stability. It's a predominantly domestic, consumer-driven economy, and services-led exports have shielded it from global disruptions.

KKR believes India is now entering a new investment regime, where regional blocs and strategic autonomy matter more than global integration. Within this landscape, India presents a unique blend of structural strength and growth potential.

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Strong Economic Momentum Despite Global Headwinds

The report forecasts India's GDP to grow steadily in FY26, with estimates ranging between 6.3% and 6.8%, according to projections from the Reserve Bank of India and the Ministry of Finance. This growth is expected to be supported by the recovery of rural demand, steady service exports, and targeted stimulus for low- and middle-income households.

India's capital markets are also witnessing strong momentum. Mutual fund data from June shows a 24% month-on-month surge in net equity inflows to ₹23,568 crore. Coupled with the RBI's 100-basis-point rate cut and improved liquidity in FY25, conditions are primed for credit expansion and stronger corporate earnings.

Investment Themes: Infrastructure, Credit, and Manufacturing

KKR is particularly optimistic about India's potential in infrastructure and credit. With a track record of significant investment in roads, renewable energy, and highways, the firm sees India's infrastructure buildout as a key opportunity. Additionally, India's positioning in the "China+1" manufacturing strategy, alongside incentives like PLIs and relaxed FDI norms, is helping it capture a larger share of global supply chains.

The report also draws parallels with Japan's ongoing corporate restructuring, suggesting India could follow suit in enhancing shareholder value, particularly in the technology and consumer sectors.

Conclusion: In the Face of Worldwide Volatility, a Strategic Outlier

KKR advises investors to "stay the course" in India, in a world that is becoming increasingly influenced by politics, security, and regional interests. India is poised to remain a top international investment destination in the years to come, thanks to its robust economic foundation, expanding capital markets, reform momentum, and scalable prospects.