As global markets brace for continued volatility amid shifting tariff policies, seasoned experts suggest India could emerge as a strategic beneficiary in the long term—provided it acts swiftly and decisively.
The ongoing trade uncertainty, sparked by Donald Trump’s tariff manoeuvrings and the broader US-China tensions, has caused tremors across global financial markets. But Mark Mobius, Chairman of Mobius Emerging Opportunities Fund, believes that while rough waters lie ahead, India’s strategic positioning may present significant opportunities.
Speaking to a media outlet, Mobius remarked, “Brace yourself, the market is likely to get even shakier. Trump’s back-and-forth on trade deals, especially with the looming 90-day window on tariff discussions, will inject more uncertainty. But India is in a very good spot.”
India’s Supply Chain Potential
Mobius, known for his expertise in emerging markets, stressed that India could step into China’s shoes in the global supply chain network, especially as international corporations reevaluate their manufacturing bases.
“India is in a position to take over the supply chain from China,” Mobius noted. “But it has got to move quickly to liberalise the system for investment and trade. Right now, it is still too bureaucratic, and that’s a hurdle that needs immediate fixing.”
His comments echo growing sentiment that India, with its young population and improving infrastructure, is well-placed to attract global investment. The key, however, lies in removing bottlenecks and facilitating smoother import-export processes—critical for sectors like electronics, where components and machinery often come from overseas.
Currency and Capital
On the monetary front, Mobius acknowledged that China’s aggressive selling of US treasury bonds is weakening the dollar and adding to the instability. He interprets this as China playing its “bargaining chip” to pressure the US.
Yet, this turbulence doesn’t spell doom for India. In fact, Mobius argued that India’s fundamentals remain strong. “I am not worried about the rupee. A weaker rupee makes Indian exports more viable. The slowdown is temporary—the long-term trajectory is strong.”
He warned of a short-term US recession but clarified that it may last only a quarter. “If Trump fails in his trade policies, it’ll have repercussions globally. But if he succeeds, it could reset the trade balance in a fair and equitable way,” he said.
Tariffs: Trouble or Tailwind?
Echoing Mobius’s cautiously optimistic tone, Anshul Saigal, Founder of Saigal Capital, believes that tariffs might end up creating winners—and India could be one of them. Speaking in a media interview, Saigal observed, “At the margin, our belief is that the tariffs will be positive for India. The volatility, once it passes, will give way to opportunity.”
According to Saigal, sectors such as pharmaceuticals (specifically CDMO), metals, and select parts of the textile industry are poised to gain. He pointed to the increasing interest in Indian-made label printing machines as anecdotal evidence of shifting global demand.
“India caters to just 3% to 15% of US textile imports in different segments,” Saigal said. “If tariffs impact Chinese exports disproportionately, Indian exports become more competitive. We’re already seeing early signs of that shift.”
Value Beyond Volatility
Saigal dismissed recent volatility as a short-term correction in a longer-term growth story. “This market still has a lot of value,” he said. “Growth is not fully priced in. Over the next one to two years, there’s money to be made if you pick the right stocks.”
He advises investors to focus on companies benefiting from both volume and price increases. Metals, in particular, stand out as a strategic play—not just in India, but globally. “As the US and Europe increase in-shoring and defence budgets, demand for metals will shoot up. Manufacturers and distributors in this segment are well-positioned,” he explained.
What to Avoid?
While Saigal is bullish on many sectors, he is cautious about technology stocks, at least for now. “Valuations remain high despite weak earnings and outlooks,” he said. “For someone like me looking at absolute returns, this isn’t attractive right now.”
He also underscored the geopolitical uncertainty and tariff effects weighing down IT services. “Even companies like TCS admit that deals haven’t been cancelled, just deferred. But until that uncertainty clears, we prefer to stay on the sidelines.”
Strategic Patience Pays
Both Mobius and Saigal are aligned in their view that while global conditions remain shaky, India’s long-term story is compelling. However, the message is clear: India must act—quickly.
Mobius stressed the urgency of reform. “To attract the Apples of the world, India must streamline how companies set up operations. The moment we do that, we’ll see a manufacturing boom,” he said.
Meanwhile, Saigal encourages strategic optimism. “Uncertainty creates opportunity. If you wait for clarity, it’s already priced in. Now is the time to prepare for the uptrend.”
As tariffs reshape trade routes and global investors hunt for new growth territories, India’s challenge is to rise to the occasion. The foundation—demographics, demand, and digital infrastructure—is in place. What remains is execution.
