2022 has been quite a volatile year, and 2023 remains full of “known unknowns", creating challenges for world leaders, policymakers, economists, companies, and investors.

How will the European winter pan out? How will the war in Ukraine end? What kind of a landing will China experience? How long will a US recession last? And these are just the known unknowns; several “unknown unknowns" will surely catch us by surprise next year.

So why is investing more like test cricket and less like a marathon? In a marathon, after the first few easy kilometers, the pain steadily builds up and doesn’t stop until the very end, where you get your medal and go home.

On the other hand, test cricket has good days and bad days—just like investing in public or private markets. On the good days, it feels like you can do no wrong and every shot crosses the boundary line.

On the bad days, you can barely get bat on ball, and before you know it, your wickets are flying in the air. Winning at test cricket requires being disciplined and giving respect to the fast bowlers early in your innings. If you can stay vigilant and meticulous in the first few overs of the day, then you can bat freely in the remaining quota of overs and score a lot of runs. And maybe in the final few overs of the day, with a good understanding of the pitch—and a strong command over the bowling—you can become creative and try a few shots from the book of cricket’s power hitters!

The good news is that, while the broader world economy is grappling with several uncertainties, India’s economy and capital markets seems to be on a much stronger wicket and seem to be largely “de-coupled" from global concerns. The BSE Sensex is close to its all-time high and goods and services tax (GST) collections in November 2022 are 11% higher than the prior year, and close to the all-time high in October. Inflation is high, but most of it is due to high oil prices.

The Reserve Bank of India has increased interest rates, but they are not yet at alarming levels.

Today’s markets will not offer any “free money," and investors will need to search for hard angles and operating levers for performance enhancement, and bring to bear global best practices to drive value creation.

Picking the right companies, backing the right entrepreneurs, and bringing a lot of operational experience to drive value creation will be key to producing high-quality returns in an already expensive market.

In my view, there are several attractive investment opportunities in India. These include backing Indian companies with globally-competitive manufacturing and services that serve global companies and earn revenues and profits in US dollars. Such companies span export-oriented sectors like technology, pharmaceuticals, speciality chemicals and automotive components. As per industry estimates, it is a $350-billion-plus opportunity that is growing at 8–10% annually. Over the next decade, we expect to see many global leaders emerge from India with differentiated value proposition for their global clients, supported by high quality Indian talent.

Another promising theme in India is investing in local companies that can generate alpha from the high-growth domestic consumption sector, supported by a large young population that is thinking beyond basic needs and graduating to aspirational “wants". These include organized branded consumer and fast-moving consumer goods companies, as well as retail-focused tech-enabled financial services companies. Some estimates put it as a $1-trillion-plus opportunity that is growing at 12–14% annually.

Several of these high-quality businesses will offer attractive opportunities for private equity investors to profitably deploy large cheques in India. This is a multi-decadal thematic which should create many multi-billion dollar companies in India.

India’s economy and corporates are on a very strong footing today, and 2023 could be a great year for deal making. If private equity investors can correctly read the wicket—and bat with a positive frame of mind—they can achieve a milestone year in 2023.

Aditya Joshi is a managing director in Brookfield’s Private Equity Group and heads the private equity business for Brookfield in India and the Middle East.