Market Radar India: Domestic Capital Anchors Growth Amid US Policy Headwinds

Written by Jorge Aguinaga

The Indian market in 2025 is demonstrating remarkable resilience, anchored by strong domestic capital, despite navigating significant policy-driven headwinds from the United States. While new US tariff and visa policies have created volatility in key sectors, the broader Indian economy stands out globally, driven by strong local investment and transformative growth in real estate and Global Capability Centres (GCCs).

The Macro View

JPMorgan has identified India as a global "bright spot" due to its robust domestic growth, stating the nation "has a strong hand to play" despite external challenges. Headwinds include a new USD 100,000 fee on H-1B visas, which threatens to increase costs for India's dominant tech industry. However, the economy's foundation remains solid, highlighted by a 53% year-on-year surge in domestic capital deployment in real estate during the first half of 2025.

Stock Market Snapshot

The H-1B visa announcement triggered immediate volatility in the stock market, causing the Nifty IT index to fall by 3%. Major firms within the sector saw significant drops in their share prices. In contrast, the outlook for capital raising is strong. JPMorgan reports that its pipeline for Indian Initial Public Offerings (IPOs) is larger than any other market, suggesting the 2025 IPO market could significantly outperform last year's.

Sector Spotlight 

Real Estate: India ranked as the fourth-largest destination for real estate capital in APAC in H1 2025, attracting USD 3 billion in institutional investments. Foreign capital made up 52% of this total, with major deals including Blackstone's USD 380 million investment in retail assets.

Flexible Offices: India now leads the world in flexible workspace market maturity, scoring a perfect 100 on Cushman & Wakefield’s index. Its market stock is projected to surpass 100 million square feet by 2026, fuelled by surging demand and a significant cost advantage over other global hubs.

The AI-Powered GCC Revolution

A key trend to watch is the evolution of India's Global Capability Centres (GCCs) from back offices into AI-powered innovation hubs. These centres are leveraging India's vast talent pool to drive major efficiencies - reportedly 20-30% - through artificial intelligence. As nearly two-thirds of the Fortune Global 30 companies now run GCCs in India, they are becoming critical for global R&D and solidifying the country's role as a hub for high-value tech talent.

---

Amid the significant capital inflows and new market realities shaping Indian real estate, the conversation now turns to strategy. Explore the future of commercial real estate, family capital, and digital infrastructure with the industry's top leaders at the India GRI 2025 Summit on October 9th in Mumbai.