As Indian equity markets continue to scale new highs, investors are increasingly recognising that long-term wealth creation cannot rely on domestic opportunities alone.
With India accounting for just a small share of global market capitalisation, a large universe of innovation, growth themes, and diversification benefits lies overseas.
In this interaction with Kshitij Anand of ETMarkets, Inderbir Singh Jolly, CEO of PL Wealth Management, explains why allocating 10–20% of a portfolio to global assets is becoming a prudent strategy for most Indian investors.
He outlines how global exposure can enhance resilience through access to international themes, currency diversification, and broader market opportunities—making global investing a core, rather than optional, element of modern portfolios. Edited Excerpts –
A) The trends are unmistakable. India accounts for only 4–4.5% of global equity market capitalisation, meaning more than 95% of investable global opportunities lie outside domestic markets.
This alone makes a compelling case for international diversification. RBI data shows a second, equally powerful trend: Indian residents’ overseas financial assets grew sharply in FY2024–25, crossing roughly USD 1 trillion, reflecting a structural shift towards global asset ownership.
This is no longer a niche allocation — global investing is now a mainstream decision for Indian households and wealth portfolios.
A) Yes — in fact, strong domestic markets have amplified the desire for global balance. Investors increasingly recognise that India’s growth story and global innovation cycles complement each other, rather than compete.
Outward remittances under the Liberalised Remittance Scheme (LRS) remain significant. According to the RBI’s DBIE dataset, LRS outflows in FY2024–25 totalled approximately USD 29.6 billion, with a rising share directed towards investments such as equities, ETFs, and global funds.
Interest in 2026 continues to strengthen, especially in the US, Japan, and global thematic solutions, signalling greater portfolio sophistication.
A) Technology and AI-centric innovation remain at the forefront. The largest U.S. technology companies represent nearly 30% of the S&P 500’s market capitalisation, illustrating the concentration of global innovation and scale.
These long-duration structural themes have limited pure-play representation in India, making global exposure essential for capturing them.
A) The USD 250,000 LRS limit remains unchanged, but the regulatory environment is shifting toward enhanced compliance, transparency, and reporting discipline.
The message from regulators is clear: India encourages outward investment — provided it is transparent, well-documented, and compliant.
A) Global investing is operationally simple when done correctly. Investors must: As overseas wealth held by Indian residents grows, compliance is a critical portfolio responsibility. Using regulated platforms or licensed advisors significantly reduces execution, tax, and reporting risks.
A) A diversified allocation of 10–20% to global assets is generally suitable for most investors, balancing India’s high return potential with access to global innovation and currency diversification.
Among high-net-worth investors, 25–40% global exposure is common, particularly for those seeking structural themes like AI, clean energy, biotech, or advanced manufacturing.
These provide diversification, transparent pricing, professional oversight, and simplified tax handling. More sophisticated investors may opt for direct global stock investing through LRS, but this requires comfort with currency volatility, foreign brokerage operations, and additional reporting obligations.
A) The United States continues to anchor global allocations. With roughly 45% of global equity market capitalisation, the US leads decisively in technology, AI, semiconductors, and healthcare innovation.
Japan has emerged as a compelling secondary allocation, supported by corporate governance reforms, attractive valuations, and strengthening earnings cycles. Emerging markets offer selective opportunities, Europe remains a tactical allocation, and China requires calibrated, risk-aware positioning.
India’s economic trajectory remains strong, but global markets offer depth, innovation, and diversification that cannot be replicated domestically.
With outbound flows rising, overseas asset ownership expanding, and global themes evolving rapidly, investors who incorporate a structured global allocation are better positioned for resilience and long-term wealth creation. Global investing is no longer optional — it is integral to a modern Indian portfolio.
Curated by Ahmed Ibrahim
