Why 10-20% global allocation makes sense for most Indian investors, Inderbir Singh Jolly decodes - The Economic Times

As Indian equity markets continue to scale new highs, investors are increasingly recognising that long-term wealth creation cannot rely on domestic opportunities alone. Global Investing 2026: Why Indian Portfolios Need Overseas Exposure. 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 - Q) Global investing has become popular in the past few years, especially in India. What does data suggest? 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. Q) As we step in 2026, are you seeing a noticeable rise in outbound investment queries from your clients despite domestic markets hitting record highs? 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. Q) What major global themes are attracting Indian investors today - AI, tech, clean energy, healthcare, commodities? 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. In addition to tech and AI, investors are allocating to: Clean energy, a sector receiving nearly USD 2 trillion in global investment in 2024 (IEA World Energy Investment report). Healthcare and life sciences, a category with an estimated global market size in the USD 8-11 trillion range. These long-duration structural themes have limited pure-play representation in India, making global exposure essential for capturing them. Q) What key changes under the Liberalised Remittance Scheme (LRS) or other regulations should investors be aware of for 2026? A) The USD 250,000 LRS limit remains unchanged, but the regulatory environment is shifting toward enhanced compliance, transparency, and reporting discipline. Authorities emphasise:...

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