This is a snapshot from May 2026, when several red flags arrived at once. Growth forecasts were trimmed across the board - Moody's cut FY27 to 6% (the low-end call), S&P to 6.6% (from 7.1%), ICRA to 6.2%. For an economy that has not contracted in 40+ years (Covid aside), a slide below 4-5% is what a recession feels like.
The stack underneath: "silent" layoffs in the $283bn IT sector (~50,000 jobs this year, ~500,000 at risk over 2-3 years, TCS's largest-ever cut) as AI questions the offshore-engineering model - structural, not cyclical. Foreign portfolio investors turned net sellers (BofA sees the selloff extending into 2027-28), though FDI held at +$7.7B. Wholesale inflation (WPI) was at a 13-year high with retail catch-up the base case. A record merchandise trade deficit of -$333B, with China overtaking the US as India's largest trading partner. An oil shock (Delhi petrol Rs 102). And an El Nino monsoon forecast at 90% of normal, which would be the driest in 11 years, and which none of the GDP cuts had priced in. Uday Kotak: "it's coming, and it's coming big."
What foreign portfolio investors did next: how much they have taken out of Indian stocks since October 2024.
Series live on https://www.tigzig.com/tremor (India WPI, trade balance, oil). Full 13-slide analysis: https://www.tigzig.com/post/india-economy-red-flag-may2026. The one bright spot (AI data centers): https://www.tigzig.com/agents-faq/is-india-becoming-a-global-ai-data-center-hub.
Building something like this? How I work covers the rates, the availability and what I take on.