ASIA-PACIFIC-WIDE Trends and Developments Contributed by: Anand Shah, Suharsh Sinha, Ishan Handa and Saloni Thakkar, AZB & Partners
Private Credit in APAC: Key Trends and Market Developments Introduction The Asia Pacific region has witnessed a significant, almost cyclonic, surge in private credit activity over the past decade, driven by evolving market dynamics, regulatory reforms, unmet capital demands coupled with localisation and control of available credit with banks (with similar appetite and funding limitations) and the growing appetite of institutional investors for alternative assets. Private credit, broadly defined as non-bank lending to corporates and projects, has emerged as a vital source of alternative capital (for bor - rowers) and deployment (for investors). Set out below is a broad overview of the latest trends and develop - ments in private credit across four key jurisdictions in the Asia Pacific region: India, Australia, Vietnam and Thailand, while placing a special emphasis on India, given its rapidly evolving landscape and the increasing role of private credit in supporting economic growth. Regional overview: private credit in Asia Pacific Private credit in Asia Pacific has grown at a compound annual growth rate (CAGR) of over 20% in the last five years, with further growth of approximately 46% esti - mated, from USD59 billion in 2024 to USD92 billion by 2027. The region’s diverse economies present unique opportunities and challenges for private credit pro - viders: Australia boasts a mature and sophisticated private credit market; emerging economies such as Vietnam and Thailand are witnessing a nascent but rapidly expanding private credit ecosystem. India, in particular, stands out as a strong contender for the crown, due to its booming economy, strong credit appetite and active regulatory reforms. India: the epicenter of private credit growth Market overview India’s private credit market has experienced expo - nential growth, with assets under management (AUM) estimated at USD17.8 billion in 2023, up from less than USD0.7 billion in 2010. India’s private credit mar - ket witnessed a sharp spike in deal value in H1 2025, with total deployment reaching USD9.0 billion across 79 deals. This eclipses the USD7-10 billion recorded across all 12 months in 2024, and the USD7.7 billion in 2023. Conversely, bank credit growth decelerated to 11% year-on-year in FY25 from 20.2% in FY24,
reflecting conservative underwriting and delayed monetary transmission. The Indian private credit market is characterised by diverse participants: global private credit funds, domestic alternative investment funds (AIFs), non- banking financial companies (NBFCs), and family offices. The demand for private credit is fuelled by several factors: deleveraging of public sector banks, tightening of regulatory norms for traditional lenders, regulatory arbitrage, and increasing sophistication of Indian corporates seeking flexible, bespoke financing solutions. According to a report by Ernst & Young for H1 2025 (the “EY Report”), borrowers across sectors include: • Mumbai International Airport Limited (Adani Group) (USD750 million) in infrastructure; • Manipal Education and Medical Group (MEMG) (USD600 million) in healthcare; • BILT Graphic Paper Products Limited (USD360 million); • Aerogrid Advanced Hosting Solutions Private Lim - ited (USD348 million) in technology; and • Alaknanda Hydro Power Company Limited (USD236 million) in energy and renewables, among others. However, real estate remained the most active sector with India’s real estate sector accounting for 42% of the deal volume in 1H 2025. Legislative and policy developments The Indian legislative and regulatory authorities have undertaken a series of legislative and policy initiatives that have facilitated the growth of the bonds market and private credit in India. The self-evaluating and ever-evolving (Indian) Insol - vency and Bankruptcy Code, 2016 The enactment of a new legislation in 2016, the Insol - vency and Bankruptcy Code (IBC), has significantly improved the legal framework for creditor rights and enforcement. The IBC marked a turning point for India’s business environment, particularly in the area of insolvency resolution. Prior to the IBC, India ranked
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