New Delhi, March 31 India’s alternative investment industry is set for strong expansion, with total assets under management (AUM) expected to grow to around $276 billion by 2030 from $152 billion in December 2025, a new report said on Tuesday.
The CareEdge Ratings report highlighted that this momentum is likely to continue, driven by rising domestic wealth, improving financial awareness and a supportive regulatory environment.
The report noted that India is on track to become the world’s third-largest economy by 2028, making it an attractive destination for both domestic and global investors.
Between 2025 and 2030, the alternatives industry is expected to grow at a compound annual growth rate (CAGR) of 11 to 14 per cent, outpacing mature markets.
A key driver of this growth is the rising number of high-net-worth individuals (HNIs) in the country.
India’s affluent population is expected to more than double between 2022 and 2027, leading to higher demand for sophisticated investment products such as Alternative Investment Funds (AIFs).
These investors are increasingly looking for diversified and higher-yielding options beyond traditional investments like mutual funds and fixed deposits.
Domestic investors are also playing a bigger role in the alternatives ecosystem. Their share in total investments has risen steadily to over 66 per cent as of December 2025, while foreign investors, though declining in share, continue to increase their investments in absolute terms.
The report further pointed out a growing preference for private credit within alternative investments.
Investors are favouring private credit due to its relatively stable returns, predictable cash flows and lower sensitivity to market volatility.
At the same time, demand for flexible financing from mid-sized companies and tighter bank lending norms have created more opportunities in this segment.
With regulatory support from market watchdog SEBI and favourable government policies, the alternatives investment space in India is becoming more transparent and structured.
As a result, industry players are well positioned to benefit from the next phase of growth, making alternatives an increasingly important part of India’s financial landscape.
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