India's PE Investment Slows Amidst Global Uncertainty, Remains Attractive Market

Private Equity investment in India saw a significant slowdown in 2025, dropping to $14.9 billion from $26.3 billion in 2024. Despite geopolitical concerns affecting US tariffs, India remains a lucrative market due to strong demographics and domestic consumption, with technology and healthcare sectors being primary targets for investment.

India's private equity (PE) investment landscape in 2025 has seen a noticeable slowdown, predominantly driven by geopolitical concerns, including US tariff policies, according to a KPMG report released on Monday. The report, titled 'Pulse of Private Equity Q3'25,' reveals that by the close of the third quarter, PE investment in the country amounted to just $14.9 billion across 217 deals. This marks a stark decline from the previous year's $26.3 billion spanning 289 deals.

If the current trend persists, 2025 could witness the slowest year for PE investment since 2019 and the lowest deal volume since 2020. Despite ongoing challenges, India remains an attractive market for PE investments, bolstered by strong macroeconomic factors, a large population, favorable demographics, and growing domestic consumption, as highlighted in the KPMG report.

The period between 2020 and 2024 showcased a much more positive investment climate, with India attracting over $20 billion in PE deal value annually. In 2024 alone, deal volume reached an all-time high with 289 deals. Global private equity firms are increasingly acting as business developers in India, often buying majority stakes and investing operationally to scale companies. Many international funds have expanded their presence in India to enhance local ties and support portfolio companies. The technology and healthcare sectors remain significant areas of interest for PE investors.