India's 2026 Outlook: Strong Growth Drivers Emerge After 2025 Consolidation

• India's economy showed resilience in 2025, recalibrating expectations and strengthening domestic fundamentals despite global challenges.
• 2026 outlook is supported by favorable demographics, robust institutional frameworks, steady fiscal consolidation, and manageable external balances.
• Inflation is expected to normalize, and corporate balance sheets are healthier, setting the stage for private capital expenditure revival.
• Key growth drivers include improved geopolitical conditions, lagged policy effects, and a revival in nominal GDP and corporate earnings.
• Equity markets will favor a bottom-up approach, focusing on companies with strong fundamentals, governance, and disciplined capital allocation.

Why It Matters: India's 2026 outlook is constructive, driven by macro stability, healthier corporate balance sheets, and improving growth.