With the strong possibility of a re-election for the Modi administration in India’s national elections that begin in April, Goldman Sachs is confident about India’s short-term economic prospects. The firm raised its outlook on India to “overweight” on high foreign fund inflows. Monetary easing by India’s central bank, the Reserve Bank of India, due to low inflation, has also spurred foreign investor inflows, driving the rupee to a seven-month high.
“The [stock market] rally has been supported by revival in Foreign Institutional Investors’ buying ahead of elections,” the Goldman Sachs report said. “Market expectations of a potentially stable government have risen over the past few weeks spurring foreign buying which have net brought $4.5 billion in India over the past 1 month.”
Most opinion polls predict a comfortable majority for the ruling Bharatiya Janata Party, with the average number predicted at 276 out of 543 seats in India’s lower house of Parliament.
Last updated: December 26th, 2025
