India remains a structurally strong market with long-term potential, but it has been underweighted tactically over the past two years due to high valuations, according to Gustavo Medeiros, head of research at Ashmore Investment.
While India is strong in the long term, current market volatility this year will be used as an opportunity to invest during market weaknesses, Medeiros told NDTV Profit in a conversation on Monday
There will likely be some noise as Trump seeks more concessions, especially from China and the European Union, Medeiros said, adding that "2025 is expected to be a volatile year for markets and can expect an increased market volatility".
The tariffs to be introduced by Trump on April 2 aim to achieve three key objectives, acting as a negotiation tool, enhancing trade reciprocity and strengthening national security. The first phase of these objectives will begin on April 2, according to Medeiros.
He highlighted that markets seemed to have already factored this in, with the US dollar index fluctuating from $100 to $110 after Trump's election and now settling at $104. "A manageable tariff increase of 8–12% might have a mild impact on the CPI, depending on how it's implemented."
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