India’s Macro Outlook Remains Strong, Says Neelkanth Mishra

India’s economy continues to show strong momentum and structural resilience, according to Neelkanth Mishra, Chief Economist at Axis Bank and Head of Global Research at Axis Capital.

Speaking at CNBC-TV18’s Global Leadership Summit 2025, Mishra said the country is witnessing a major shift in investment behaviour as more domestic investors participate in financial markets. He described this trend as a new phase in the economy’s evolution, driven by steady growth and strong macro indicators.

GDP Growth Expected Above 7% by FY26

Mishra projected that India’s real GDP growth will exceed 7% by March 2026, while nominal GDP could return to 12% levels within 12–15 months.

He added that tariff changes may temporarily affect market sentiment but would not alter India’s core macro fundamentals, which remain robust.

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Market Movements and Investment Flows

On equity trends, Mishra observed that hedge funds have been selling Indian equities to reallocate funds toward other global markets. However, he clarified that this movement does not signal any weakness in India’s domestic fundamentals or long-term growth outlook.

AI Bubble Could Last Two More Years

Commenting on global technology trends, Mishra said the world may experience two more years of bubble formation in artificial intelligence (AI) before valuations begin to stabilise.

He noted that the current AI-driven investor frenzy reflects a broader transformation in how economies and markets are adapting to technological disruption.

Key Highlights

• India GDP Growth: Expected to exceed 7% by FY26

• Nominal GDP: May return to 12% levels in 12–15 months

• AI Bubble: Likely to last two more years before stabilising

• Tariff Changes: Won’t affect macro fundamentals

• Market Outlook: Hedge fund selling doesn’t signal weakness

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