FPI inflows at $6 bn in Mar on hopes of more reforms
Foreign investors have pumped in about $6 billion in capital markets so far this month, buoyed by expectations that BJP's victory in assembly polls is a precursor to more "bold, reformist policies" in India.
The inflows follow a net investment of Rs 15,862 crore in equity and debt last month. Prior to that, FPIs had pulled out a total of over Rs 80,000 crore from October to January.
According to depository data, foreign portfolio investors (FPIs) infused a net sum of Rs 22,268 crore in equities during March 1-24 and another Rs 16,177 crore in the debt segment, translating into a combined inflow of Rs 38,445 crore ($5.84 billion).
Investors believe that the government will continue with its bold reformist policies following a huge BJP win in Uttar Pradesh and Uttarakhand, Bajaj Capital Senior V P and Head Investment Analytics Alok Agarwala said.
"This decisive win in the largest state by population (UP) is positive for FPI sentiment and resulted in higher FPI inflows as overseas investors get more bullish about the continuance of the reforms process in the country," he explained. BJP formed government in four of the five states that went to polls recently. It formed government in UP, Uttarakhand, Manipur and Goa, while in Punjab Congress came to power.