Post JP Morgan index inclusion, FPIs turn sellers in FAR securities

Passive inflow, amount (in ₹ crore) 

 

Foreign portfolio investors net bought ₹1.09 trillion worth of Indian government securities designated under the FAR (fully accessible route)  route after the official inclusion of domestic securities in the JP Morgan indices between July 2024 and March 2025. The inclusion process was phased over a 10-month period with 1 per cent weight included each month until March 31, 2025.

 

After completion of inclusion process of domestic government securities in JP Morgan Indices on March 31, 2025, FPIs have net sold ₹31,262 crore worth of FAR securities so far. The selling was primarily driven by profit-booking, along with narrowing of the yield spread between 10-year US Treasury bond and domestic benchmark 10-year bond which narrowed below 200 basis points in April as domestic demand on the back of expectations of deeper rate cut weighed on yields.

 

Active inflow, amount (in ₹ crore)

 

After the announcement of the inclusion in JP Morgan indices, there was net active inflow worth ₹92,302 crore between September 2023 and June 2024 as investors took positions ahead of the official inclusion. Investment in FAR securities had exceeded  ₹1 trillion on October 16, 2023.