Did India Regains Favour of Global Investors? - Bank of America Report

In its December Asia Fund Managers’ Survey, Bank of America revealed that nearly 10 per cent of fund managers are now net overweight on India as against zero per cent in the previous month.

Ahead of 2026, the south Asian nation has transitioned from being the least preferred market to becoming the third most favoured equity market in Asia after Japan and Taiwan, as per the BOFA report.

Key Factors In India's Favour Ahead Of 2026

This comes after India reported real GDP growth acceleration to 8.2% in September 2025, the fastest in six quarters, driven mainly by private consumption and resilient domestic demand.

In November, high-frequency indicators revealed that economic activity held up after the festival season, with urban demand strengthening and services expanding, even as manufacturing showed mild deceleration.

However, the ever-evolving nature of global trade policies and tariff actions continued to pose risks to exports, but due to coordinated fiscal, monetary and regulatory measures resilience improved.

Meanwhile, benign inflation and supportive financial conditions continue to provide room to sustain growth momentum.

Notably, India witnessed a net foreign investment inflows of $1.9 billion in October 2025, as against net outflows of USD 2.3 billion in the preceding month.

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On other hand, the net outflows of foreign direct investment (FDI) moderated to USD 1.5 billion from USD 1.7 billion in September 2025.

The global investor outlook on Indian economy was likely impacted by the recently inked India-New Zealand FTA.

Top industry association FICCI sees the tariff-free access under the pact to improve the competitiveness of Indian exports and support employment-intensive sectors, alongside higher investment in agriculture and allied activities.