Nomura's Sonal Varma On India's Growth, Global Challenges, Tariffs, Inflation, Markets And More

Watch Sonal Varma, Managing Director & Chief Economist (India & Asia ex-Japan), Nomura in conversation with Siddharth Zarabi, Group Editor, Business Today, as they discuss India's growth trajectory amidst global challenges. The conversation touches upon key topics such as the global impact of tariffs on India, inflation trends, the outlook for GDP growth, and the sectors most affected by the current economic climate. Nomura recently revised its GDP growth forecast for India in 2025, lowering it by 10 bps to 5.9%, reflecting a more cautious outlook. Despite this, Nomura remains confident that India is "the least exposed" to shocks from the US' tariff announcements. This is due to India's domestic-demand orientation, benefits from lower oil prices, and its position as a strategic ally to the US, which can help India capitalize on trade diversion and supply chain shifts in the medium term. Nomura continues to forecast 7% growth for India in 2026, signaling a stable long-term outlook. The discussion also covers Nomura’s Nifty 50 outlook, with the target for March 2026 set at 24,970 points, reflecting a 3.5% rise from current levels. Nomura expects a market return of (-9%) to 7% over the next year. Furthermore, Nomura believes that private sector investment and capital expenditure will remain weak in the near term, with urban consumption still sluggish, although rural India shows some positive momentum.