Indian investors are increasingly setting their sights on global equities, while venture capital firm General Catalyst is adjusting its India strategy. This shift comes as domestic investors seek diversification and exposure to international markets, and as global investment strategies evolve in response to changing economic conditions.
Rising Interest in Global Equities
Data from the Reserve Bank of India (RBI) indicates a significant increase in investments into international equities. In the first nine months of 2025, Indian investors deployed $1.6 billion into overseas stock markets, surpassing the $1.5 billion invested throughout 2024. This figure represents a substantial increase from the $400 million invested five years prior.
Several factors drive this surge in global investing. Portfolio diversification is a primary motivator, as investors seek to reduce risk by allocating assets across different geographies and asset classes. Exposure to global technology leaders, many of which are listed on U.S. stock exchanges, is another key attraction. Additionally, some investors use global equities as a hedge against potential rupee depreciation.
Platforms like Vested Finance and IndMoney currently facilitate a large portion of these trades. However, major domestic brokers are preparing to enter the market. Zerodha CEO Nithin Kamath has indicated plans to offer global investing options by early 2026, potentially based in GIFT City. Dhan and Smallcase are also developing global investment products.
Despite the increasing interest, the base of Indian investors participating in U.S. markets remains relatively small, with approximately 2.0-2.5 million traders compared to 45 million domestic traders. However, the momentum suggests that global investing is rapidly gaining traction among Indian retail investors.
General Catalyst's Evolving India Playbook
General Catalyst, a prominent Silicon Valley venture capital firm, is recalibrating its investment strategy for India. The firm is shifting its focus towards manufacturing, defense, and deeptech, aligning with a new "global resilience" investment thesis. This marks a departure from its previous emphasis on consumer internet companies.
Neeraj Arora, Managing Director at General Catalyst, highlighted that India has immense tech talent and is a blank slate to play with in manufacturing and defense. General Catalyst intends to bring innovation to India by investing in startups and leveraging its portfolio companies in other regions.
The firm plans to invest between $800 million and $1 billion in Indian startups over the next three years, focusing on sectors like AI, defense, healthcare, energy transition, manufacturing, and fintech. Hemant Taneja, CEO and Managing Director, emphasized India's potential leadership in AI and manufacturing, citing the country's growing talent pool and role as a supply chain hub.
General Catalyst has also launched the General Catalyst Institute (GCI) in India, a platform for startups, policymakers, and stakeholders to engage in discussions. A key focus for GCI is the regulation of artificial intelligence (AI).
Global Funds Reconsidering India
As concerns about an AI investment bubble rise, global fund managers are increasingly considering India as an alternative market. India's relatively low dependence on AI and its strong consumer-driven economy make it an attractive option for diversification. Aberdeen Group Plc expects Indian equities to rebound, while Principal Asset Management Co. and Eastspring Investment see the market's low correlation with AI as a buffer against global equities.
Several factors support Indian equities, including tax cuts, labor law reforms, domestic liquidity, and stabilizing corporate earnings. The central bank has reduced interest rates, and the economy has demonstrated strong growth.
