AI bubble may last two more years: India’s macro outlook stays strong, GDP likely to top 7% by FY26, says Neelkanth Mishra

Neelkanth Mishra says India’s investor boom and AI frenzy mark a new phase in the economy’s evolution

India’s economy remains on a firm growth path and is witnessing a structural shift in investment behaviour, according to Neelkanth Mishra, Chief Economist at Axis Bank and Head of Global Research at Axis Capital.

Speaking at CNBC-TV18’s Global Leadership Summit 2025, Mishra said tariff changes may affect sentiment around India but do not impact the country’s macro fundamentals. He expects real GDP growth to exceed 7 percent by March 2026, with nominal GDP returning to 12 percent levels in the next 12–15 months.

On market trends, Mishra said hedge funds have been selling Indian equities to invest in other global markets, but this shift does not signal weakness in domestic fundamentals.

Commenting on the global technology cycle, Mishra said the world could see two more years of bubble formation in artificial intelligence (AI) before valuations stabilise.