Beyond the Terminal: A Calling from ‘Inevitable India’

Every NRI knows this feeling. You land in India after years away, breeze through immigration and baggage claim, and step into a country that instantly feels both familiar and remarkably transformed. The airport is smarter, more digital, and more efficient. The billboards outside speak of new ambitions and new possibilities. Before your cab has even left the terminal, you’ve already caught a glimpse of an India that’s moving ahead at an extraordinary pace.

As your visit unfolds, that first impression only grows stronger. New flyovers crisscross the skyline, Metro networks stretch into previously distant suburbs, expressways cut travel times dramatically, and in Mumbai, engineering marvels like the Coastal Road have redrawn the city’s map. Places you once navigated effortlessly suddenly feel unfamiliar. The skyline has changed yet again. Even everyday conversations with family and friends reveal a nation thinking differently—more confident, more ambitious, and more optimistic about what lies ahead.

Then comes the journey back. You pack these experiences alongside your luggage, carrying home a quiet sense of pride and amazement. But once you’re back in your routine overseas, those observations gradually fade into the background. Your investments continue as before, your financial plans remain unchanged, and the transformation you witnessed firsthand is left out of the decisions shaping your wealth.

India: A Story That Defies Simple Narratives

Recent global narratives have been dominated by economies riding the AI infrastructure wave. India does not feature in this today. But this is not new. Even during the technology boom of the late 90s, India did not invest billions in networking, fibre and internet. It put it to work and in doing so, created companies that became global names. For AI too, while India knows that it surely needs to move up the innovation curve, the first chapter belongs elsewhere. The second, where adoption drives productivity across a large domestic economy, is where India potentially stands to reap the real benefits.

Unlike economies whose fortunes are tied to a single theme like memory chips or a commodity, India is genuinely diverse. It has new-age technology companies and decades-old industrials. A financial sector serving millions of first-time borrowers and investors. A healthcare industry supplying drugs to the world and performing complicated surgeries at a fraction of the cost. A consumption story driven by a rising middle class and an infrastructure buildout that is only partially through. Exports and global themes matter, but India’s first engine has always been domestic. That separates India from other Emerging Economies.

India has often been a story that defies simple narratives. It disappoints the most optimistic and also outlasts the most pessimistic. It tends to do its best quietly, when most people start looking elsewhere.

Turning Uncertainty into Opportunity

Although global markets have recently faced headwinds from AI-led valuation exuberance and elevated oil prices, India’s economic fundamentals continue to remain strong. Controlled inflation, disciplined fiscal management, a sustainable current account deficit, robust foreign exchange reserves, healthy corporate balance sheets, and increasingly mature capital markets have collectively strengthened India’s ability to withstand global volatility.

History also shows that India has often used periods of disruption to accelerate structural reforms. The implementation of the Goods and Services Tax (GST) created a unified indirect tax regime, while the Insolvency and Bankruptcy Code (IBC) introduced much-needed discipline into the country’s credit ecosystem. Labour reforms modernised a regulatory framework that had remained largely unchanged for decades. More recently, the development of Digital Public Infrastructure has laid the foundation for unprecedented financial inclusion and digital commerce, creating a model that has attracted global attention. Time and again, India has demonstrated its ability to navigate external challenges without losing sight of its long-term growth trajectory.

This momentum is also evident at the state level. Chief Ministers are actively competing to attract both domestic and international investments. What was once described as cooperative and competitive federalism is now increasingly visible in practice, with states driving reforms, improving ease of doing business, and positioning themselves as attractive destinations for investment and economic growth.

‘Spot’light on Rupee: Looking Beyond Recent Volatility

For an NRI assessing India from overseas, the sharp depreciation in the rupee over the past couple of years may appear to be a reason for caution. In US dollar terms, returns on Indian investments have looked softer than the underlying rupee performance would suggest. It deserves a closer look though.

The Rupee, assessed on a Real Effective Exchange Rate (REER) basis, which adjusts for inflation differentials across trading partners, is currently undervalued. The reasons for the depreciation are worth understanding. Valuation differentials, AI-led investment trends, tariff uncertainty, geopolitical disruption across West Asia affecting energy prices and risk appetite, and elevated US bond yields drove FPI outflows from India and put the rupee under pressure. These are temporary dislocations due to the challenging global environment, and not structural flaws.

Historically, the rupee depreciates against the dollar broadly in line with the India-US inflation differential. That is the long-run anchor. Around it, there will always be periods of overshooting driven by sentiment, flows and global events. We are in one such period today. Importantly, with the RBI’s inflation targeting framework now firmly established, the inflation differential between India and the US has narrowed considerably. Leaving aside temporary dislocations, a structurally lower inflation differential should, over time, translate into a lower rate of rupee depreciation than what investors have historically witnessed. For an NRI with a long investment horizon, an undervalued currency is not necessarily a risk. It could be an additional source of return.

The investment case therefore carries a twin tailwind for overseas investors. The structural upside of Indian equities, amplified by the currency gains that a mean reversion toward fair value could deliver going forward.

The Diaspora’s Legacy: Crisis Capital Then, Structural Ownership Now

India’s diaspora has historically stepped in as a meaningful source of capital during periods of external stress. Pokhran nuclear tests in 1998 drew international sanctions and ‘Resurgent India Bonds’ raised over $4 billion from NRIs. Similarly, in 2000, the ‘India Millennium Deposits’ channelled over $5 billion. After the Taper tantrum in 2013, the RBI’s FCNR-B swap scheme brought ~ $30 billion within weeks. RBI has again announced measures that would lead banks to offer FCNR deposits at attractive rates now.

But this time, the argument for equity is also strong. And the context is fundamentally different.

Indian capital markets today have a depth and breadth that did not exist in any of those previous episodes. The number of listed companies, the sectoral diversity, the quality of disclosure and governance, the liquidity available to investors, all of these have improved substantially. More importantly, Indian markets are no longer primarily dependent on foreign flows. Amidst heightened volatility, monthly SIP inflows have remained resilient at approximately $3 billion in CY26, a consistency that has held through every bout of volatility. In December 2025, Domestic Institutional Investors (DIIs) surpassed Foreign Portfolio Investors (FPIs) in ownership of NIFTY 50 companies.

Indian markets are becoming, gradually and credibly, self-reliant.

That said, India’s growth ambitions are vast. The investment required to sustain 7% plus growth, build infrastructure, expand manufacturing capacity and deepen financial inclusion cannot be met by domestic flows alone. Both are needed. Domestic and foreign. Policymakers have been engaging with FPIs to understand and address their concerns, and sooner or later, FPIs could resume meaningful flows into Indian equities.

The Arbitrage of Insight: What the Diaspora Sees

NRIs occupy a unique position in this landscape. They live and work in developed markets. They are exposed to varied wealth creation strategies, sophisticated financial products and bring a valuable cross-border perspective.

At the same time, they have something that institutional FPIs do not. They come home. They have conversations with family, with former colleagues, with business owners in cities that are changing faster than any research report captures. They get a pulse of India’s transformation in ways that cannot be reduced to a Market-Data Terminal or a brokerage note.

This makes NRIs among the most naturally positioned investors for the India opportunity. Not because of sentiment. Because of information.

GIFT City: Bridging Global Capital with India’s Growth Story

For the global Indian community of over 30 million people, GIFT City is emerging as a seamless gateway to participate in India’s economic growth. The establishment of the International Financial Services Centre (IFSC) marked a significant milestone in bringing India-linked financial transactions back to domestic shores while positioning GIFT City as a globally competitive financial hub. Its growing prominence is reflected in the rapid expansion of its asset management ecosystem, with fund managers securing commitments exceeding US$15 billion as of March 31, 2026.

For non-resident Indians, GIFT City-domiciled funds simplify investing into India by allowing investments in foreign currency without the need to open an Indian bank account, demat account, or obtain a PAN. Through GIFT City feeder funds, overseas investors can efficiently access established Indian mutual funds with proven long-term performance. Combined with a favourable tax framework, simplified repatriation mechanisms, and significantly lower operational friction than conventional investment routes, GIFT City offers an efficient and investor-friendly platform for the diaspora to participate in India’s long-term growth journey.

Capital That Continues to Build India

Every visit to India eventually comes to an end. NRIs return to the countries where they have built their careers, businesses, and lives. Their capital, however, doesn’t have to leave with them.

India’s economic transformation doesn’t pause between homecomings. Wealth creation continues every day—in expanding businesses, rising consumer demand, infrastructure development, technological innovation, and the steady formalisation of the economy. These are long-term trends that continue to compound regardless of where an investor resides.

By investing in India, NRIs remain connected to this journey from anywhere in the world. Their capital continues to participate in an economy they understand instinctively and often more deeply than global investors. When they return home and witness another transformed skyline, a new metro corridor, or thriving business district, they won’t simply be observing India’s progress. They will know they have played a role in shaping it.

The author is MD and CEO, HDFC AMC Ltd. 

Disclaimer: The views expressed are the author’s own and do not reflect the official policy or position of Financial Express.