Billionaire investor Mark Mobius said that India remains to be the leading emerging market space, and he does not see China overtaking India's growth in the long term.
Mobius underscored that in spite of short-term volatility and US tariffs on Indian imports, factors such as robust domestic demand, the government's reform initiatives, and the resilience of Indian businessmen will enable India to continue its advantage over other emerging economies. The investor has invested close to 20 per cent of his portfolio in India.
Speaking to the Economic Times in an interview, he added that industries like pharma, gems, and apparel may be affected by US President Donald Trump's 50 per cent tariff on exports. However, he is confident that Indian companies can adapt by relocating manufacturing to other parts of the world, such as Africa.
“Indian entrepreneurs are very creative. I think they will be able to get around some of these problems,” Mobius said.
On the impact of US tariffs, he further said, "At best, exports might trim 0.5 per cent to 0.75 per cent off economic growth. But India's domestic market is huge and still growing fast. Even if the growth projection drops from 6 per cent to 5.5 per cent, it's not a problem."Mobius criticized the US also for targeting India for Russian oil imports, noting that China is taking in a similar amount. He added that diplomacy could solve the issue, particularly with the global crude price falling.
He also highlighted the weaker rupee as a positive for exporters and noted that government support measures will cushion the blow. “The Indian market looks healthy. The economy is still doing very well. Eventually, India and the US will reach an agreement because this situation cannot last long,” Mobius noted.
The investor had previously indicated that India can be the second-largest economy in the world. "India now has a much bigger population than China. It is now approximated that China's population is really 800 million or less and has an average age significantly higher than India's 1.4 billion people," he stated.
Over the past few years, India has risen from the 11th-largest economy to the fourth-largest economy in the world. By 2025, India is ranked after the US, China, and Germany in terms of overall GDP.
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