Traditionally, ETFs were seen as a way to track broad markets or indexes. These were often indexes such as the S&P/ASX 200 Index (ASX: XJO) or the S&P 500 Index (SP: .INX). 

Funds that track these indexes are still great cornerstones of many portfolios. However, targeting emerging sectors can also help capture future growth. 

These are often referred to as thematic ASX ETFs. 

New insights from Global X have highlighted two such sectors that could be set for growth. 

Indian market lag creates opportunity 

A new report from Global X has reinforced the opportunity for Indian equities. 

However, it is important to point out that they have had a rough start to 2026. 

According to the report, the Indian share market started 2026 with its worst relative performance versus emerging markets in over 30 years.

However, there are three key tailwinds set to kick in that could help future growth. 

Firstly, the ETF provider pointed towards policy stability. 

Global X said India's government is reducing its fiscal deficit while maintaining significant capital expenditure. This is evident across transport, energy, and defence. 

Continued investment in infrastructure supports long-term productivity, while incentives for electronics, semiconductors, and clean energy help shore up domestic manufacturing and supply-chain resilience.

Secondly, trade clarity with the US is improving. 

The long-anticipated US-India trade deal removed a major overhang for markets, easing tariff uncertainty and improving sentiment among foreign investors. 

Finally, AI infrastructure is emerging as a growth engine. 

Global X said major global tech companies (including Amazon, Microsoft, Google, Meta, and others) have announced large-scale commitments to AI, cloud, and data centre buildouts across the country. 

With hyperscaler spending accelerating, India is aiming to transition from an outsourcing destination to a foundational AI infrastructure hub.

ASX ETFs to consider if you are looking for exposure to Indian equities include: 

• The Global X India Nifty 50 ETF (ASX: NDIA)
• Betashares India Quality ETF (ASX: IIND)

AI infrastructure buildout 

Another global sector set for future growth is AI and semiconductors.

Of course, the growth of artificial intelligence is not a new idea. 

However, Global X has outlined the case that the semiconductor sector is moving through an important transition from cyclical to structural. 

What this means is the first phase of the AI trade was driven by demand for compute, concentrating gains in a small group of AI chip designers and hyperscalers as training and inference scaled rapidly. 

Now, as AI systems grow, tightening memory supply, surging storage needs, and rising data centre power demands are revealing infrastructure constraints. This is shifting the story from pure compute to a broader build-out across semiconductors and physical assets.

The AI build-out is now spreading across two distinct layers. The first is the digital layer, which sits within the semiconductor ecosystem and includes memory, foundries, chip designers, equipment, and advanced packaging.

The second is the physical layer, which allows that compute to operate at scale. This includes electricity generation, grid upgrades, data centres, cooling systems, and the broader industrial capacity required to support them. As AI workloads grow, this layer becomes just as critical as the chips themselves.

To target semiconductors directly, an ASX ETF to consider is the Global X Semiconductor ETF (ASX: SEMI). 

For investors looking to target the physical layer of the AI buildout, a fund to consider is the Global X AI Infrastructure ETF (ASX: AINF). 

The post Niche ASX ETFs headed for massive growth appeared first on The Motley Fool Australia.

Billy Leung, Senior Investment Strategist, reinforced that while gold and silver have dominated recent headlines, there is still plenty of opportunity in other corners of the market.

Here are three other themes investors should be aware of. 

AI infrastructure 

According to Global X, the narrative around AI is currently evolving. 

Reports are emerging that OpenAI is testing alternatives to Nvidia. 

According to Reuters, OpenAI has been unsatisfied with some of Nvidia's latest artificial intelligence chips, and it has sought alternatives since last year. 

While this has raised concerns around potential market share loss for Nvidia, switching costs across AI hardware, software stacks and developer ecosystems remain high, both in time and capital.

Mr Leung said the more important takeaway is not a sudden loss of Nvidia's dominance, but the continued broadening of the AI value chain. 

As AI workloads scale, opportunities extend beyond leading chip designers into the infrastructure layer supporting compute, networking and data centre build-out.

SpaceX and xAI

Another emerging story is that SpaceX and xAI are reportedly planning to merge ahead of a potential mega IPO, valuing the combined entity at around US$1.25 trillion. 

If realised, this would be one of the largest technology listings in history. It would also reshape the investable universe across launch services, satellite communications and frontier technologies.

This analysis supports a case for investing in defence shares because it points to a powerful overlap between defence, aerospace, and the rapidly accelerating space economy.

It could generate tailwinds for defence and aerospace companies supplying propulsion, satellites, sensors and mission-critical systems.

India and US Trade

Finally, the US is set to cut tariffs on India to 18% following commitments by Prime Minister Modi to curb Russian oil purchases and increase US imports. 

According to Global X, the announcement triggered sharp moves in India futures, easing a key macro overhang and reinforcing India's role within US-aligned supply chains. 

This development has been supportive for Indian equities and the rupee. 

While near-term volatility will persist, the combination of external resilience, domestic liquidity and institutional depth supports the case for India as a structural growth market rather than a macro risk trade.

How to gain exposure with ETFs

For investors looking into these themes more deeply, there are several thematic ASX ETFs that track these sectors. 

For global AI exposure: 

• Global X Artificial Intelligence ETF (ASX: GXAI)
• Global X Ai Infrastructure ETF (ASX: AINF)

Global defence: 

• Global X Defence Tech ETF (ASX: DTEC)
• Beta Global Defence ETF (ASX: ARMR)

For exposure to India: 

• Betashares India Quality ETF (ASX: IIND)
• Global X India Nifty 50 ETF (ASX: NDIA)
• VanEck India Growth Leaders ETF (ASX:GRIN)

The post Investment themes investors should be watching closely – Expert appeared first on The Motley Fool Australia.

Due to its large domestic economy, India is viewed as being in a better position to withstand a recession. It is one of the world's fastest-growing economies, underpinned by strong structural fundamentals.

The direct tariff impact on India is expected to be minor, given India's relatively low exposure to the US. According to Bloomberg, India accounted for just 2.7% of total US imports last year. This is significantly below China and Mexico, which accounted for 14% and 15% respectively. 

Additionally, compared to Beijing, New Delhi has struck a more moderate tone while attempting to secure a provisional trade agreement with the Trump administration over the next 90 days. This may prove to be a highly beneficial move. If companies decide to shift their supply chains away from China, India could benefit substantially.

Fund managers expect India to outperform

Fund managers looking to reallocate capital to defensive equity markets have named India as a compelling option. 

In a 9 April note, Jefferies Financial Group strategist Mahesh Nandurkar suggested that India should outperform on a relative basis. He cited lower dependence on the US and China, relatively lower tariff impact, and a pro-growth central bank. 

On this basis, Jefferies Financial Group recently increased its exposure to India in its recommended Asia ex-Japan model allocation.

How can ASX investors gain exposure?

For ASX investors looking to follow suit, there are two exchange-traded funds (ETFs) to consider. 

Betashares India Quality ETF (ASX: IIND) tracks 30 high-quality Indian companies. Holdings are selected based on high profitability, low leverage, and high earnings stability. It offers a 12-month distribution yield of 3.4% and a management fee of 0.8%. For the year to date, IIND has declined nearly 7%, outperforming other popular ETFs. For comparison, Vanguard US Total Market Shares Index AUD ETF (ASX: VTS) has declined 12% over the same timeframe. 

A second option to consider is Global X India Nifty 50 ETF (ASX: NDIA). It invests in India's 50 largest and most liquid companies, spanning a wide range of economic sectors. The management cost of 0.69% is slightly lower than IIND. It has also been a stronger performer for the year to date, declining just 3%.

Foolish takeaway

India has been touted as a potential beneficiary of the US-China trade war. With tensions heating up, companies may consider India as an alternative manufacturing hub to China. Those looking to dip their toes into Indian equity markets may wish to consider adding the Betashares India Quality ETF or the Global X India Nifty 50 ETF to their portfolio.

The post Why are fund managers currently so bullish on Indian equity markets? appeared first on The Motley Fool Australia.