India and China – two prime emerging markets
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Zaheer Lalani, Principal Advisor of Sovereign Advisors, and Max Riaz, Investment Manager, explore the firm’s decision to exit Chinese equities in March 2023 and shift into India. The move was based on concerns that China was underperforming expectations and that geopolitical risks—particularly the escalating US–China rivalry and the precedent of Russian sanctions—posed significant threats to investors. Unable to find a clean “ex-China” emerging markets option, they partnered with a manager aligned to their views, which delivered strong early returns.
India is seen as a long-term structural play rather than a temporary allocation. Its equity markets have delivered steady 10% annual growth, underpinned by a rising middle class, strong domestic consumption, education, and industrial capacity. Recent trade pressures have also pushed India to open further to foreign companies, potentially accelerating growth. While India remains the central emerging market theme, the firm remains open to re-entering China if there is genuine rapprochement with the US, as China’s vast domestic savings could create outsized opportunities for financial institutions.
Copyright 2025 – Finance News Network
Source: Finance News Network
