Core Insights - The MSCI Emerging Markets Index has gained nearly 31% year-to-date, while the MSCI India Index has only increased by 1% this year, indicating underperformance in Indian equities [1][2]. Group 1: Market Performance - The MSCI India Index's modest gain of 1% contrasts sharply with the overall emerging markets performance, suggesting potential future opportunities for investors [2]. - The underperformance of Indian stocks has led to more attractive valuations, with the market trading at 23.5 times earnings, down from a five-year average of 27 [5]. Group 2: Future Outlook - The potential easing of U.S. tariffs on India in 2026 could serve as a catalyst for Indian ETFs like the WisdomTree India Earnings Fund (EPI) and the WisdomTree India Hedged Equity Fund (INDH) [4]. - Analysts and asset managers currently view Indian stocks as a top hedge against AI trade risks, which may enhance their appeal moving forward [7]. Group 3: Economic Factors - The Indian government and the Reserve Bank of India (RBI) are implementing measures to stimulate the economy, including tax simplification and interest rate cuts, which have raised the RBI's growth estimate from 6.5% to 7.2% for the fiscal year [6]. - The consumption-driven nature of India's economy is regaining favor, with equity gains being primarily driven by banks, consumer firms, and services [8].