BlackRock Sees India's Comeback Story Just Beginning As Oil Prices Collapse | Ben Powell

ELI5/TLDR

A senior BlackRock strategist sat down with ET Now just after the US–Iran tensions eased and oil tankers started flowing again. His pitch: India spent the last year being punished for nothing it did wrong — expensive oil and the perception that it missed the AI boom. Now oil is back below pre-war prices, which is a direct gift to an energy importer like India, and foreigners are tiptoeing back into Indian stocks. He thinks the recovery is barely starting. He still likes US tech because the AI build-out is real, and warns that the easy “own everything and go to the beach” era of investing is over.

The Full Story

India got punished for someone else’s party

Ben Powell, BlackRock’s chief investment strategist for the Middle East and APAC, frames India’s dull year as a case of guilt by association. Two global trends went the wrong way for it at once: oil spiked, and the market obsessed over AI — a story where India wasn’t seen as a frontline player.

“India perceived not to be at the forefront of the AI trade, and I guess the wrong side of the AI correction, the wrong side of the energy problem… I always said don’t think India did anything wrong. It just got caught the wrong side of those two global big trends.”

Now one of those headwinds has flipped. With the oil artery unblocked and prices back to pre-war levels, the biggest weight on India — its energy import bill — has lifted. Powell is openly bullish, and reaches for a baseball metaphor (apologising for not using cricket): this isn’t even the first inning of the recovery. Foreign buyers have only just started returning “in the last few days,” valuations look cheap by historical standards, and higher prices tend to manufacture their own confidence, which pulls in more buying.

What the money buys when it comes back

If foreign flows return in force, Powell expects the old reliables first — banks above all, maybe a dash of construction. The deeper theme he keeps circling is what the Chinese call self-reliance: every country now wants its own capability in energy, defence, and technology, because nobody trusts global supply chains the way they used to. “Made in India” plays sit squarely in that bucket.

On the AI worry, he reframes it. The question for India isn’t whether it builds the chips — it’s whether Indian companies use AI to get more productive and grow earnings. A young, tech-savvy workforce is the raw material; the job for investors is to find the specific companies that turn the tool into profit.

Still overweight America

Powell is unapologetic about staying overweight US equities. The reasoning is blunt: the US is where the future “gets discovered and monetized,” and the AI build-out is producing real earnings that keep surprising to the upside. His provocative line is that the market still underestimates AI demand — “we are still not bullish enough it would appear.”

AI is inflationary first, utopian later

The most useful idea in the conversation is his stance on whether AI pushes prices up or down. BlackRock’s view: in the near term, up.

“Before we get there, we’ve got to build a thing. We need copper. We need plumbers. We need data centers. And the money that’s pouring into this ecosystem is so huge that for now, AI is going to be inflationary.”

The dreamy abundance — robots doing everything cheaply — may come, but it’s a decade out. Right now hundreds of billions are chasing a tight supply of the physical stuff, and that lifts prices. Which is why, he argues, the Fed can’t just fast-forward ten years and hope; it has to manage an inflation rate that’s run above target for roughly five years. So rates stay higher for longer, and that’s a mild headwind for risk assets everywhere — including India, though he notes India’s own inflation looks tame and the RBI is comfortably in wait-and-see mode.

The beach is closed

Powell’s closing message is a regime change. When rates were near zero, a rising tide lifted all boats — you could be long everything and switch off. That world is gone.

“The era of the everything bull market is over… some companies will fail to achieve their cost of capital, whereas some companies will flourish.”

His prescription: be more active, more selective, and open-minded about alternatives — property, gold, even some crypto — because a plain stocks-and-bonds portfolio “won’t get it done” anymore. He admits it’s simply more work.

Key Takeaways

An oil price collapse is a direct, mechanical tailwind for India because it’s a large energy importer — the import bill is one of the biggest swing factors in its macro picture.
India’s weak year was driven by two external trends, not domestic missteps: expensive oil and the AI-narrative leaving it out. When those reverse, the underlying growth story re-emerges.
BlackRock’s near-term call on AI: it’s inflationary, not disinflationary. The build-out (data centers, copper, electricians) creates more demand than supply, propping up prices and keeping the Fed cautious.
“Trust in earnings” is the real swing variable for foreign flows into India. The last few quarters saw estimates getting nudged down; flows return once forecasts become credible again — confidence follows, not leads.
The investing mental model BlackRock is pushing: the zero-rate “own everything” era is over. Higher cost of capital separates companies that clear their hurdle rate from those that don’t — forcing a shift to active, selective, alternatives-inclusive portfolios.
“Self-reliance” / “made in X” is a global structural theme, not just an Indian one — driven by eroding trust in global supply chains across energy, defense, and technology.
The AI question for a country isn’t only “can it supply chips” but “can its workforce and companies use AI to lift productivity and earnings.”

Claude’s Take

This is a well-spoken sell-side macro view, and it should be read as exactly that. Powell is articulate and the framing is genuinely useful — the “India did nothing wrong, it just caught two bad trends” line is a clean way to think about why a market can languish without a domestic problem, and the “AI is inflationary before it’s disinflationary” point is the one idea here worth actually filing away.

But notice what it is: a BlackRock strategist, on Indian business TV, telling Indian viewers that foreigners are about to rediscover their market and that the recovery is barely in the first inning. The incentives all point one direction. There are no falsifiable claims, no numbers beyond “valuations look cheap,” and a lot of careful hedging (“I’m nervous to say it,” “I always want to be careful”). The ET Now anchors lob mostly friendly questions and the one devil’s-advocate probe gets answered with the same optimism, repackaged.

Score 5/10: clear, sensible, and a decent snapshot of how a big allocator is talking about India and AI in mid-2026 — but it’s promotional macro commentary, light on specifics, and you’d be unwise to mistake confident delivery for an edge. The inflation-then-abundance framing is the keeper; the India cheerleading is context, not a forecast you can lean on.