FPIs may find India attractive as oil prices fall, fundamentals improve

If Brent crude falls and the rupee appreciates to some extent, the import bill could be somewhere between $105 billion and $125 billion for the financial year

Foreign investors may come back to India because of the fall in oil prices and the improvement in the domestic fundamentals, but that could happen only after they make sure the oil correction is here to stay and India’s deficits are bridged.

The crude oil price for the Indian basket has averaged $74/barrel (bbl) in the current financial year. The rupee-dollar exchange rate has averaged Rs 69.6 a dollar. 

In the Budget 2018-19 (FY19), the petroleum and finance ministries had calculated the oil import bill to be $105 billion on the assumption that the international oil basket would average $65/bbl and the