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Buoyed by PSB recap plan, FPIs infuse $2.6 bn into Indian stocks this month

India gained 30 places in the World Bank's ease of doing business index to 100th among 190 nations this year

Press Trust of India  |  New Delhi 

FPI investments
Representative Image

have pumped over $2.6 billion in the country's this month so far, propelled by government's announcement of recapitalising PSU banks and India faring well in the World Bank's 'index'.

This follows a net inflow of over Rs 19,000 crore in (equity and debt) last month. Prior to that, had pulled out more than Rs 10,000 crore in September.

According to depositories data, (FPIs) infused Rs 16,455 crore in equities during November 1-24, besides, they put in Rs 754 crore in the debt market during the period under review, resulting in an inflow of Rs 17,209 crore ($2.65 billion).

"The inflow could be attributed to some of the positive developments in the recent times. One amongst them is the government's announcement of recapitalising public-sector banks, which is expected to enhance lending and propel economic growth.

"This is particularly seen as a positive step after the questions were raised from various quarters on the government's ability to effectively implement economic reforms. Additionally, slight improvement in global sentiments and stable currency could have also turned the tide in India's favour," Morningstar India Senior Analyst Manager Research Himanshu Srivastava said.

In November, what triggered inflow was the about India faring well in the World Bank's index and a jump in core sector growth, he added.

India gained 30 places in the World Bank's index to 100th among 190 nations this year.

"This positive provided a much-needed breather to who were concerned about the short-term impact of demonetisation and GST on the domestic economy and sluggish pace of economic recovery," Srivastava said.

Recently, the US-based Moody's has upgraded India's by a notch to 'Baa2' with a stable outlook citing improved growth prospects driven by economic and institutional reforms.

Finance Minister Arun Jaitley on October 24 announced the programme of Rs 2.11 lakh crore, out of which Rs 1.35 lakh crore will come from recap bonds, and the rest from and budgetary support.

Overall, have invested Rs 53,800 crore in equities this year and another Rs 1.46 lakh crore in debt

First Published: Sun, November 26 2017. 14:03 IST