B Capital's Howard Morgan sees India filling global vacuum created by Trump tariffs

Market

• India set to gain from US isolationism and US-China tensions
• India's venture ecosystem and investor base have strengthened
• Risks include political instability and energy shocks impacting growth

Did our AI summary help?

Global venture capitalist and CEO of B Capital, Howard Morgan, said India stands to gain structurally from US isolationism under President Donald Trump and the ongoing economic decoupling between the United States and China, creating a “vacuum” that India is increasingly positioned to fill.

Speaking at the India Global Forum in Mumbai, Morgan said the protectionist shift in US policy has opened space for countries like India to expand their global economic role.

“I do buy that,” Morgan said when asked whether current geopolitical tensions could structurally benefit India. “President Trump has very deliberately tried to push the isolationist agenda, and that leaves a hole, a vacuum that India can fill and is filling.”

He added that tensions between the US and China — which he described as likely to remain an economic rather than a military conflict — could further increase India’s importance in global supply chains and economic partnerships.

“Because of the conflict with China, which is hopefully never going to be a hot conflict but certainly an economic conflict, India has a great role to play in that,” Morgan said.

Morgan, whose firm B Capital has invested more than $1.5 billion in India over the past decade, said the country’s venture ecosystem and investor base have strengthened significantly in recent years.

He pointed to stronger public market participation and the growth of early-stage venture capital activity as key developments in the Indian market.

“The early-stage venture market has grown dramatically,” he said. “We’re now starting to be able to realize some of that, which is the most crucial thing in venture — returning capital to investors.”

At the same time, Morgan cautioned that India’s growth trajectory could still face risks.

“Anything could derail it,” he said, citing political instability and energy shocks as potential challenges. A prolonged crisis in West Asia, he noted, could affect India given its reliance on imported oil.

“OIl is a crucial resource for India,” he said. “If the crisis in what we call the Middle East or West Asia lasts too long, that could start to derail.”

Morgan also said venture investors are becoming more cautious in emerging markets and are conducting deeper due diligence on startup finances.

He noted that B Capital increasingly uses artificial intelligence tools to analyse company financial data, including detailed revenue records, to detect irregularities.

“We want to see your detailed financials and every single order,” he said, adding that AI-based analysis has helped identify unusual patterns in some cases.

Despite these risks, Morgan said India’s entrepreneurial momentum and expanding technology ecosystem signal a broader shift in the country’s role in the global economy.

“What makes this different is the spirit,” he said. “India can have a global technology play — more than just being the services arm and customer support for the rest of the world.”

With sustained economic growth, Morgan said India could continue climbing the global economic rankings in the coming years.

“With that GDP growth, you’ll go from number four to number three pretty quickly,” he said.