Key points:
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– Indian exports rise to the US and China despite tariffs and rupee depreciation
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– Electronics, pharmaceuticals, engineering, petroleum, and marine products lead export growth
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– Significant investment from Microsoft (NASDAQ:MSFT), Amazon (NASDAQ:AMZN), Alphabet (NASDAQ:GOOG) strengthens India’s AI sector
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– Nifty 50 index up 7%, with renewed optimism tied to potential trade deals and macro stability
India’s export sector continues to deliver robust performance despite substantial US tariffs, according to Mugunthan Siva from India Avenue Investment Management. Siva points out that US-bound exports have actually increased, driven primarily by strong gains in electronics and pharmaceuticals, which grew 38% and 20% respectively in November. The rupee’s depreciation, with limited intervention from the central bank, has supported export competitiveness, not only with the US but also with China – Indian exports to China rose over 33% from April to November, fuelled by demand for electronics, engineering goods, petroleum, and marine products.
Siva highlights an influx of investment from AI hyperscalers like Microsoft (NASDAQ:MSFT), Amazon (NASDAQ:AMZN), and Alphabet (NASDAQ:GOOG), totalling nearly $70 billion for infrastructure and capability centres. With government incentives, a young workforce, and significant digital infrastructure like the Aadhaar card system, India appears well-placed for accelerated growth in AI and efficiency-focused sectors, including healthcare. Amazon’s announced investments are expected to create over one million local jobs, reflecting the country’s favourable demographic profile and digitisation momentum.
Looking ahead to 2026, Siva singles out externally facing industries poised for global expansion, suggesting these will benefit most if a US-India trade deal materialises. On the Indian stock market, Siva notes the Nifty 50 index’s steady performance, up nearly 7% for the year and close to record highs, with expectations of a renewed growth trajectory should geopolitical risks ease and trade agreements firm up.
