India Has the Edge Over China, Top Destination for Investors in the Long Term: Report India is positioned as the leading growth story of the 21st century, having strategic advantages over China and other emerging markets and is a top destination for equity investments, said a report by Bay Capital, an India-focused investment management firm.

India is positioned as the leading growth story of the 21st century, having strategic advantages over China and other emerging markets and is a top destination for equity investments, said a report by Bay Capital, an India-focused investment management firm.

The firm said in its report that global investors are now moving away from China due to "geopolitical risks," and India is poised to capture more capital helped by its stable economic environment, thriving entrepreneurial ecosystem, and a digital economy that has seen immense growth. The firm said that the country is ready to deliver robust economic growth and significant investment returns for patient, long-term investors.

Siddharth Mehta, Founder and CIO of Bay Capital, said, "Institutional investors are reallocating capital towards India as geopolitical risks surrounding China grow. While China's valuations may appear attractive, its long-term uncertainty makes India a more compelling choice. India's youthful population, rapid digital adoption, and thriving entrepreneurial ecosystem make it an exceptionally strong long-term investment destination."

The report further advised investors to look at long-term investments, citing benefits of reduced risk over a 5-7 year period, with data suggesting that investors with a longer investment horizon face a significantly lower risk, with the probability of losses decreasing from 31 per cent over one year to 0 per cent in 20 years.

On the venture capital side, Ankit Kedia, founder and lead Investor, Capital-A said that the next decade belongs to Indian Hardware.

"With strong policy support, rising global demand, and a shift towards self-reliance, India is shifting gears to become a global manufacturing hub. In 2025, we are doubling down on investments in startups that bring innovation, defensibility, and scale to manufacturing—whether through automation, advanced materials, or sustainable production methods," said Kedia.

Kedia also added that as a firm, Capital-A is convinced about backing founders who are building world-class products in India for global markets, and sees this as a defining moment for India's industrial growth.

Bay Capital in its report also said that the Indian economic trajectory will outpace China over the next several decades due to China grappling with geopolitical tensions and economic challenges. The report stated that India remains relatively insulated and stable, increasingly attracting global institutional investors

Keyur Majmudar Managing Partner, Bay Capital Investments Advisors further noted that the current market conditions reflect a natural re-adjustment after the post-Covid period.

"While margin tailwinds are dissipating and consumption credit growth is unwinding, India's long-term growth story remains intact. We continue to believe the investment environment moving forward will be different from the last 2-3 years. Bottom-up investing, discipline, an ability to invest with a 5-year horizon, and temperament will be key differentiators."

Rajmohan Krishnan, Principal Founder and Managing Director, Entrust Family Office, a family-office investment advisor told Entrepreneur India that thelast few years have seen equity giving high returns and as global macro turns uncertain and earnings growth sputters, equity returns for the next few years may not match those of the recent past.

"Family offices need to rejig their asset allocation to reflect this reality, especially for the short to medium-term. Special attention needs to be paid to fixed-income or debt+ instruments like REITs, private credit, and VC debt in order to enhance portfolio returns," said Krishnan.