India grows 6.5% a year as hotels fill and foreign money returns (opens the source in a new tab)
- Noah Smith (Noahpinion) argues India is quietly doing great: growth near 6.5% a year, faster than China since the pandemic, extreme poverty largely gone, public investment about four times pre-pandemic levels and exports widening.
- An ET Prime analysis finds the same strength in hotels. After the US-Iran war raised fuel prices and cut flights, Indian guests kept filling rooms and paid higher rates, from budget brands to palace suites.
- Investors are noticing. Foreign funds have bought nearly $6bn of Indian shares in November, the most since September 2024 after two years of selling, Reuters reports, as some look for an alternative to AI-heavy markets.
- 6.5%
- India's yearly growth (Noahpinion)
- $6bn
- Foreign buying of Indian shares in November (Reuters)
- 80%
- Indian Hotels occupancy in Q2, up from 75% (ET)
Why it matters A hotel night is a choice, not a need. When Indians pay more for one during a war shock, it points to a wider base of households with spare cash, the kind of home demand growth needs once the public spending push fades.
Other side One quarter, a BRICS summit in Delhi and upbeat earnings calls are thin proof, and foreign money that arrives in a month can leave as fast. Smith himself warns that private investment and FDI still lag, and state-led spending lifts growth only for a while.
Also read: Indian shares rise on foreign flow optimism; financials, autos lead