Its down for many reasons. Mostly the shit shape of our economy and its outlook.

1. There is no more cheap money. As the reserve banks raise interest rates a lot of reserve banks follow suit. With Inflation targetting, rate increases into the future is also baked in. Many lawyers here have only seen the era of cheap money. The era cheap money began from 2008 and somebody had to finally bite the bullet. India was a beneficiary of cheap money.

2. India is not an FII destination during the AI boom build out. All FII chasing returns are there investing and finding deals in AI. So not many stock deals either. Speculative fast money spent a lot of time in emerging market in the decade before, not anymore in this geopolitical environment. That money is going home - for some time too.

3. Even FDI for India is net negative with more outbound transaction with indian conglomerates investing more abroad for markets abroad. India conglomerates within its business families continue to run safe margin based businesses and not risk based business - there is no appetite for risk, be it R&D spend or aggresive expansion. Good sectors with potential like pharma continue to remain bleak too. Sun pharma went for its biggest acquisition abroad.

4. As the Rupee depreciates everything technically is cheaper for someone entering India but one sees India loves to protect its champions. Look what Tesla or BYD faces. Protectionism in the right places remains rampant in India and its alive to the point where genuine foreign interest in India has died. Minimal investments from foreign companies and many exits.

5. Indian manufacturing had a false start post covid in the 1+1 era. China managed to keep the +1 within ASEAN countries. India's hostility with China ensured this as we faced strict rare earth ban. Chinese supply chain controlled ruined an Indian rise in manufacturing. I dont know if the governement Press Note 3 was also a great idea as China knows how to hurt us more. Many chinese companies were hit with tax and fema violations that reeked of blowback. Not a good look. You always want predictability.

6. The geopolitical sceranio in the Trump 2nd term has been disastrous for a staid India. India faces a perpetual energy crisis, India lost access to Russian oil briefly which was a hedge in more ways than one. All of this means Indian consumption especially rural is down. India has handled Trump poorly hands down. I dont think anyone else would have done better - but that has definietely pushed to the back of the line in many things.

7. On top of that India is staring the bad end of a trade deal. A trade which we know is coming but India like fools didnt make a deal early and hung it out so late - it committed right before a court in the US ruled it all out being outside of Trumps powers, meaning sign up to any deal has no real value. This trade limbo has meant many bad consequences. A Ford re-entry died. It also means India agri wont have much time left to be subsidized.

8. India's genuine moat - IT sector - is slowing as the python of AI strangled before swallowing. Indian IT is the sole reason India didnt have the issues facing Sri Lanka, Pakistan or Nepal. Indian IT helps India keep its neck above water with balance of payments issues. This is going to be the biggest issue down the road. A lot of Indian middle class rose from this sector. This sector is struggling. A switch to more AI on foreign LLMs means the wage advantage is lost, as companies spend forex paying for tokens. The GCC play is not going to replace this moat either.

9. Even big projects have started to slowdown. The recent news that India is not going to buy Japanese trains for its HSR lines is actually a story about the govt straining its budget but has been shared with media as some sort of great indigenizarition measure. There is a genuine drawdown in terms of grandiose projects, because we dont have room on our balance sheet as our fiscal gap widens from the target.

10. The taxation policy remains punitive with state capacity means money is squandered. Tax admininstration remains poor, while direct and indirect collection has gone India's complexity index remains high. On the ground GST is a disaster worse than the government lets on - it is a genuine pain to get input credits back making it worse than the old excise and VAT regime.

11. India reforms have slowed down. Between IBC, GST and slow water down DPDP, a lot of novel legal work has already been squeezed out. IBC pushed restructuring work - that pipeline is slowing down as the NPA's have been cured. This has helped banks, but Indian banks wont get into another funding frenzy anytime soon.

12. The immigration pipeline out of India is also breaking apart in the face global anti immigration wave. How does this impact M&A? As companies are forced to become efficient wage efficiency is still deprioritized. They rather invest into AI/ Robots. This means offshoring to India is down. Look at a company like Honeywell which is downsizing and moving plants back to the developed world. Reversing offshoring kills many possible deals involving small and medium sized Indian companies who would have been offshoring targets or its suppliers.

All in all that is a dozen reasons - these many cuts - slow our economy down. The government and opposition should be shouting from the rafters about it. Instead our government is focussed on breaking opposition parties for a re-run at the delimitation amendment project to secure its reign for the next few decades. All of this means deal pipeline for M&A becomes a trickle.