In 2025, the S&P 500 posted roughly 18% gains on the year. But the Euro Stoxx 50 index posted slightly better gains, and some emerging-market indexes like China’s Hang Seng were up even more.
That means when it comes to growth, investors need to consider overseas opportunities as part of their strategy. The Indian stock market is one such investment theme to consider thanks to big demographic tailwinds in the region, consistent gross domestic product growth and other attractive factors. India’s real GDP is projected to grow by approximately 6.9% in 2026 driven by strong domestic demand, about three times the pace of GDP growth expected in the U.S.
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Structurally, India also offers an increasingly robust equities market where leading India stocks rival other multinationals in terms of market value. In fact, the total market capitalization of India’s stock market now tops $5 trillion — placing it among just five global markets to cross that threshold alongside the U.S., China, Japan and Hong Kong. Also of note is that active investors in India now surpass the number of Americans who own stocks.
With metrics like these, India’s stock market has become increasingly attractive not only to domestic investors but also to global participants. As a result, U.S. investors are actively exploring ways to gain exposure to the world’s fifth-largest economy.
Here’s how to invest in the world’s fifth-largest economy via the best India stocks:
— How to invest in the Indian stock market through ETFs.
— Other notable India ETFs.
— How to invest in Indian stocks directly.
— Consider broader goals before investing in India.
How to Invest in the Indian Stock Market Through ETFs
For investors seeking diversified exposure, exchange-traded funds (ETFs) offer one of the simplest and most efficient entry points. The iShares MSCI India ETF (ticker: INDA) is among the most established options for those looking to buy Indian stocks without picking individual companies. With more than $9 billion in assets under management and average daily trading volume of almost 7 million shares, it offers strong liquidity comparable to many large-cap domestic ETFs.
INDA holds around 165 stocks, including major companies such as financial leader HDFC Bank Ltd. (HDB), India energy giant Reliance Industries Ltd. (RELIANCE.NS), and telecom Bharti Airtel Ltd. (BHARTIARTL.NS), among others. For investors seeking broad exposure to India’s largest and most influential corporations, this fund provides a straightforward solution.
The expense ratio is 0.61%, or $61 annually for every $10,000 invested. Sector exposure is led by financials (30%), followed by consumer discretionary stocks (12%).
[Read: Recession 2026: What to Watch and How to Prepare]
Other Notable India ETFs
Several additional ETFs provide alternative exposure strategies, though they share the same approach of INDA that involves a diversified portfolio of India stocks.
Franklin FTSE India ETF (FLIN): The No. 2 option among India ETFs, FLIN manages about $3 billion in assets and features a notably low expense ratio of 0.19%. It also contains a larger number of total stocks at 275 individual positions. However, sector weightings are similar, with financials (30%) and consumer discretionary stocks (12%) ranking as top areas of focus.
WisdomTree India Earnings Fund (EPI): With $2.7 billion in assets and an expense ratio of 0.84%, EPI is somewhat more expensive than the alternatives but offers the broadest diversification, with more than 550 stocks in its portfolio. Its sector allocation differs slightly in part because of this wider array of companies, with energy (17%) in the No. 2 spot behind financials (26%)
iShares MSCI India Small-Cap ETF (SMIN): For investors seeking higher growth potential, SMIN offers exposure to approximately 500 Indian small-cap stocks. It’s smaller, with only about $700 million in assets, but is still well-established and sponsored by major ETF provider iShares. SMIN provides access to companies that are often listed exclusively on domestic exchanges as well as small-cap investments that are harder to research. Keep in mind, however, that these small India stocks typically carry greater volatility and risk compared to large-cap holdings.
How to Invest in Indian Stocks Directly
Investors who prefer purchasing individual stocks have more limited options, as only about a dozen India stocks are listed on U.S. exchanges through American depositary receipts (ADRs). Of this list, only eight of those rise to more than $1 billion in market valuation. They are:
— HDFC Bank, financials.
— ICICI Bank Ltd. (IBN), financials.
— Infosys Ltd (INFY), technology.
— Wipro Ltd. (WIT), technology.
— Dr. Reddy’s Laboratories Ltd. (RDY), health care.
— MakeMyTrip Ltd. (MMYT), consumer discretionary.
— ReNew Energy Global PLC (RNW), utilities.
— Sify Technologies Ltd. (SIFY), communications services.
Many major Indian companies, including well-known Tata Group affiliates, are not directly accessible to most U.S. retail investors. Their shares trade primarily on domestic Indian exchanges and are generally available only to foreign institutional investors.
Additionally, many multinational companies with significant operations in India may be worthwhile investments to capitalize on the region but will not show up if investors are screening only based on corporate headquarters. These are indirect investments in India, but can be effective in some circumstances.
Consider Broader Goals Before Investing in India
As with any international investment, thorough research is essential. While India offers compelling growth potential driven by favorable demographics, economic expansion and capital market development, it also presents risks — as do stocks in any region of the world.
Investors should evaluate their individual financial goals, time horizon and risk tolerance before allocating capital to Indian equities. With careful consideration, exposure to India may serve as a valuable component of a diversified global portfolio.
Risk and volatility aren’t always a bad thing, either. Leading India ETFs can provide cost-effective and diversified exposure, but may never be able to match a direct investment in an up-and-coming stock.
Choosing the right investment in the India stock market, then, is as much about understanding your personal investment goals as it is about researching the right Indian stock or ETF.
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Indian Stock Market: How to Invest in the World’s 5th-Largest Economy originally appeared on usnews.com
