At a time when Indian markets are underperforming, investors are grappling with three key questions. Can markets rally despite weak fundamentals? Where does India stand as the global economic order realigns? And will artificial intelligence (AI) ultimately help or hurt Indian IT companies?

According to Radhika Gupta, MD and CEO of Edelweiss Mutual Fund, the answer to all three comes down to one word: trust.

In a post on X, she wrote, “Three questions I keep getting asked: Can markets rally when fundamentals are weak? Where does India fit as the world realigns? Will AI help or hurt our IT companies?................... Hard to disagree.”

https://x.com/iRadhikaGupta/status/2104544542754218391?s=20

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In The Entropy Trap, a book on the global economic transition and the forces reshaping financial systems, author Mickey Maini explores how geopolitics, macroeconomics and technology are increasingly interconnected. The book also examines how businesses and investors can navigate the coming decade across money markets, AI, energy and real assets.

Gupta, who recently read the book, highlighted Maini’s view that trust can be a key source of pricing power, capital and customer relationships.

In an earlier post on X, Gupta noted how developments across the world are increasingly interconnected, with events such as a strait closing in the Gulf, bond yields moving in Mumbai or chip rules changing in Washington influencing business decisions in India. She described The Entropy Trap as a tool for managing capital and leading businesses, stressing the importance of understanding the system rather than forecasting exact numbers.

Trust is particularly relevant as investors grapple with weak market fundamentals, shifting global relationships and the disruption posed by AI. While markets can rally ahead of fundamentals, the sustainability of such gains depends on confidence in businesses and the broader economic environment.

For India, trust could influence how businesses attract capital and navigate global realignments. It may also prove crucial for Indian IT companies as AI transforms technology services, with strong customer relationships and credibility helping them maintain their relevance.

She believes that trust ultimately offers a key advantage in the form of pricing power, capital and customers.

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She also said the book gave her a perspective on why understanding the changes in the global system is key to understanding India’s growth story.

https://x.com/iRadhikaGupta/status/2098348906765771233?s=20

(Disclaimer: The recommendations, suggestions, views and opinions expressed by the experts are their own and do not represent the views of The Economic Times)

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