Cost To Certainty: India's Opportunity And Constraints In A Rewired Global Order

(MENAFN- Live Mint) At the fifth and final roundtable of the Mint Leadership Dialogues-Season 2 in Mumbai, participants agreed that the global environment is not simply stabilizing or fragmenting-it is doing both, while simultaneously creating new openings. The real question is how businesses interpret and act on this mix.

There was broad agreement that stability is not the defining feature of the current moment. As Khurshed Daruvala, chairman, Sterling & Wilson put it,“So, not stabilizing for sure. Destabilization... and the opportunities getting thrown up because of the destabilization globally are massive...”

“Unpredictable and it'll stay that way,” added Promeet Ghosh, managing director (CEO) and managing director (MD), Crompton Greaves Consumer Electricals Limited.“What it brings home to us is, agility is the critical attribute of corporates today.”

That emphasis on agility was echoed across the table, with Akshay Hiranandani, CEO, Serentica Renewables noting that firms will increasingly be judged by“how agile you are to take care of the threats and dart into the opportunities”.

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Yet, beneath this shared recognition of opportunity, there was a sharper concern around capital-particularly from a financial system perspective. Jairam Sridharan, MD and CEO, Piramal Finance pointed to a deeper dislocation:“India as a country is capital deficit. So we need inflow. What we are seeing is basically outflow in every form.”

Sridharan also flagged the issue of debt capital, warning that foreign debt capital has now become super risk-off. That has left both capital and labour“positioned unfavorably right now, and it requires a Herculean effort and the government doing a bunch of heavy lifting to push us to a better place”.

Taken together, the picture that emerged was not contradictory but layered. As Vishal Sharma, CEO-chemicals, Godrej Industries Ltd summarized,“All three [are] happening together... the Western world... is fragmenting,” and Indian businesses must actively identify where they fit.“We need to find our sweet spots, and those sweet spots are changing.”

Pointing to the covid era, Amit Varma, founder and managing partner, Quadria Capital, said this is an opportunity for alpha generation.“You need to get in, stick to whatever your core theses and strategies are, and hopefully they play out, as we've seen in the past.”

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Nirmal Jain, founder of IIFL Group, added the macro lens: global trade and capital are not shrinking, but“getting rerouted” and“redirected”, with India likely to benefit as those shifts settle.“Globalization is fragmenting, which is also creating new opportunities,” Jain said.“When the dust settles, countries like India stand to benefit a lot, because we are the only large economy that's growing so rapidly.”

The scale of opportunity-and the supply gap

Indeed, if there was one area of convergence, it was the scale of opportunity that the current crises presented.

“If you look at infrastructure alone, it represents a multi-trillion-dollar, multi-year opportunity,” said Vineet Mittal, founder and chairman, Avaada.“There are supply constraints across the value chain-from cables and steel structures to transformers, power electronics, and other critical components.”

According to Mittal, demand across the energy ecosystem is unprecedented.“We are seeing strong international interest as well, with stakeholders from markets such as the US exploring whether India can supply critical equipment like transformers or support project execution,” he said.

Daruvala underlined the scale of upcoming opportunities, saying the capital investments in new-age infrastructure are significantly higher than earlier cycles. A 1,000MW solar plant would cost ₹3,000 crore, but a 1,000MW data centre“would cost you ₹40,000-50,000 crore of just electromechanical work. If you add IT, it comes to about ₹1,00,000-1,60,000 crore.”

The opportunity set, therefore, is not just broad-it is deep and capital-intensive. Jain mapped this across sectors:“electronics, semiconductor, renewables, defence, railways... infrastructure, speciality chemicals,” all pointing to a multi-sector investment cycle.

At the same time, the domestic market remains a critical anchor. India's low per capita consumption levels create a parallel opportunity. As Sharma noted,“per capita consumption we are 1-10th to 1-50th of global averages... we need to look at those unsold opportunities”.

This dual dynamic-India as both a demand and supply story-was reinforced by Puncham Mukim, head, private equity and senior managing director, India, Everstone Capital, who said,“India is not just about demand, it is also about supply... 60% of what the US imports in pharmaceuticals by volume comes from India... the shelves of a Walgreens or Walmart will go empty if you tariff a business like that.” He added that this model could extend to other sectors with new trade linkages.

Capital is available-but not always usable

A notable shift in the discussion was the distinction between availability of capital and its effective deployment.

From a market perspective, Amisha Vora, chairperson and MD, PL Capital Group pointed out that recent global flows have favoured high-risk, high-return bets.“India was the worst performing market in the past four to six quarters. One of the key reasons... was that all the money was chasing AI investments and AI stocks, largely in the US, China and Taiwan.” India, in contrast, has taken a more pragmatic route-particularly in areas like data centres.

“We said we cannot innovate like that... we will adopt... let's become a data center country,” she said. But this also defines the return profile:“if you put one rupee in 5 years it will become 2 rupees... a 15-18% ROE kind of a business.”

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She also pointed to the broader policy-led opportunity creation underway.“With agile policy-making, opportunities are being created, and entrepreneurs and business houses are taking advantage of them. At the same time, globally there are new challenges emerging.“So, when we sound somewhat cautious, it is because while these opportunities are emerging and the dream of India becoming a manufacturing hub is unfolding-with better logistics, infrastructure and power availability-some established sectors will also face challenges. Both realities will coexist.”

Hiranandani added a strategic layer to this, arguing that the question is not just where to invest, but how to define competitive advantage.“At the end of the day, innovation is not a skill-it is a culture... we also need to think about where our 'right to win' lies... whether that is first-time innovation, incremental innovation, or even reverse engineering what already exists and making it better and cheaper.”

He also linked this to broader economic evolution:“I also think it depends on how affluent we become as a community... as we build more wealth as a nation, you will start to see more innovation and greater spending on R&D.”

This ties into a broader point on scale. As Ghosh noted, the real differentiator is not just growth rates but absolute impact:“7% of a small number is still a small number, while 1% of a much larger number is a very large number.”

The missing layer: innovation and risk capital

Despite the scale of opportunity, participants were candid about a structural gap-innovation.

Sharma framed it starkly:“Where are our inventions? Where is our Apple?” His argument was not just about outcomes but incentives.“No one wants to go for the high-risk game... you go bankrupt, you're most likely not getting another loan.”

This is reinforced by low R&D spending. As Sharma pointed out, India's investment remains a fraction of global peers, raising the risk that“we are going to remain copycats”.

Anish Mashruwala, partner, JSA Advocates & Solicitors connected this to both technology and mindset.“We are resilient as a race... AI is going to change... it's just how we use it.” But he also highlighted a deeper structural constraint:“We are very cost-conscious... we want the best quality at the cheapest price... and that is very hard to deliver when we are competing at a global scale... because of this, innovation has often taken a back seat.”

Jain pointed to the absence of risk capital.“Capital is there, but risk capital is limited... unless the government subsidises and invests, it will be difficult to build strong R&D.” He added that while talent exists,“we have not been able to do the same in our home country.”

At the same time, there was recognition that this may evolve over time. As Mukim observed, India is only now entering a phase where private capital has generated meaningful returns at scale.“As they make more money, they will gradually develop an incremental risk appetite.”

Execution constraints: talent and MSMEs

Even where capital and opportunity align, execution remains a constraint-particularly in talent and enterprise scale.

Varma highlighted this sharply from the healthcare sector:“Capital is no longer a problem. The problem is who's going to utilize it.” The shortage is not just at the high-skill end but across roles, from engineers to technicians.

Mittal noted that even engineering graduates often require significant industry training before becoming fully productive.“If India is to build lasting industrial leadership, we must evolve from being a consumer society to a producer society,” he said.“Without becoming producers, we will not build deep R&D capability at scale.”

Sridharan brought attention to MSMEs as a critical lever.“MSMEs are crucially important... they generate a large share of employment... but they are among the least levered in the world.” The opportunity lies in enabling them to scale.

China plus one: opportunity, but not yet scale

On“China plus one,” the consensus was clear: intent exists, but execution is lagging.

Sharma described the current shift as“small and slow,” constrained by structural bottlenecks. Similarly, Mukim noted that global buyers are willing to diversify but remain concerned about“certainty and timeliness of supply.”

Varma captured the gap succinctly:“Geopolitics is certainly helping... but we are doing a remarkably poor job of acting on that sentiment.”

At the same time, the pathway may not be binary. As Daruvala suggested, India does not always need to compete directly with China. In some sectors,“China can be part of the supply chain... and then significant value addition can happen here,” creating a more gradual transition.

Key Takeaways

India's capital deficit poses challenges, but significant opportunities exist in infrastructure and emerging sectors. Agility in business strategies is crucial for navigating the current unpredictable global landscape. Innovation and risk-taking culture are essential for India to transition from a consumer to a producer economy.

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