In 2025, the MSCI Emerging Markets Index achieved a remarkable 33.6% return, significantly outperforming the S&P 500's 17.9%. This shift was largely attributed to a weakened US dollar, improved valuations, and better earnings growth across Emerging Markets. India, however, lagged behind with only 4% returns due to currency weakness and foreign investor withdrawals. Despite this, India's economic fundamentals are strengthening, aided by fiscal measures like income tax adjustments and the rollout of the 8th Pay Commission, which are expected to boost household consumption. Additionally, India's sovereign rating upgrade by S&P Global Ratings in August 2025 could attract more global investors. The expansion of Global Capability Centres and a growing domestic investor base further support India's market outlook. With private consumption growing at 7.7%, India is well-positioned for a potential recovery in 2026, making it an increasingly attractive option for investors looking at Emerging Markets.