Finance Minister Nirmala Sitharaman on Thursday mentioned that whereas commerce recalibration poses challenges and creates uncertainties, India will navigate these international disruptions with coverage agility and a long-term imaginative and prescient.
Talking on the a hundred and fiftieth yr anniversary celebrations of the BSE, Sitharaman emphasised that the best path in constructing financial resilience is thru fostering home efficiencies and competitiveness.
“The intensification of tariff wars and the rise of protectionist insurance policies have the potential to disrupt international provide chains, enhance manufacturing prices and create uncertainty in funding selections throughout borders as nicely. India is assured that it’s going to navigate these international disruptions with coverage agility and long-term imaginative and prescient,” Sitharaman mentioned.
On April 2, US President Donald Trump introduced reciprocal tariffs on main economies, together with India. The tax announcement had a ripple impact on monetary markets throughout the globe, together with Indian markets. Nonetheless, after Trump gave a 90-day reduction, home markets recovered all of the losses incurred instantly after the tariff announcement.
Sitharaman mentioned that regardless of the latest international uncertainties, India’s monetary markets have proven exceptional resilience. Testomony to that is that within the second half of March 2025, international portfolio buyers made substantial investments in India’s monetary sector, channeling over Rs 17,500 crore into monetary shares, she mentioned.
On the identical time, DIIs, the home institutional buyers, within the final monetary yr, recorded complete inflows of Rs 6.1 lakh crore, far outpacing the Rs 1.3 lakh crore web outflows from FDIs.
“This transition of DIIs from a supporter to a dominant drive underlines the rising maturity and depth of India’s capital market,” she mentioned.
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Sturdy financial fundamentals stand up to VUCA
Sitharaman mentioned that the world at the moment is stuffed with volatility, uncertainty, complexity and ambiguity (VUCA) which is shifting day by day.
“One factor stands agency — the energy of the Indian financial fundamentals and the macroeconomic prudence with which the economic system is being managed,” she mentioned.
India’s focus stays firmly on constructing a strong home basis and the muse is laid and strengthened by infrastructure growth, inclusive progress and deeper regional cooperation.
“These usually are not simply buffers to exterior shocks, however accelerators for our long-term progress aspirations,” she mentioned.
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Pushed by a powerful regulatory structure and by enabling reforms comparable to dematerialisation, buying and selling plus one (T+1) buying and selling settlement cycle, direct market entry and mutual fund penetration, the nation has constructed one of the strong market infrastructures on the planet, the minister said.
In FY2025, market capitalisation of Indian inventory markets crossed $5 trillion marketplace for the primary time, making it the fifth largest capital market globally. Previously 5 years, home indices have delivered 131 per cent dollar-adjusted return, which is the best amongst international friends.
Sitharaman additionally lauded retail buyers which have positioned their religion within the home inventory markets.