The government on Thursday ruled out a rollback of the "super-rich" tax on FPIs organised as trusts or association of persons
They have been on an unbroken selling streak since the Union Budget, spooked by increase in income-tax surcharge, taxes on buybacks, and lack of stimulus to prop up the economy
Sovereign borrowing abroad could make the currency more volatile in the future
FPIs have been net buyers for the past five consecutive months
According to reports, about 2,000 FPIs operate as trusts
Mody said the increase in surcharge was to provide benefit to the taxpayers who are in the lower end of the income tax slab
The realisation that the new tax rate applies not just to the super rich but also to trusts - a structure of choice for a large number of foreign funds that invest in the nation
According to the latest depositories data, FPIs invested a net sum of Rs 1,915.01 crore in equities and Rs 5,180.43 crore in the debt segment during Jun 3-7
FPIs invested a net Rs 1,352.20 crore in equities on May 23, when the ruling BJP scored a thumping victory in the general elections
Investors have adopted a strategy of 'wait and watch' as the Lok Sabha Elections are underway
The time frame for investment may have dissuaded funds wanting to invest, say experts
Foreign portfolio investors were net buyers for the previous two months as well, infusing a net sum of Rs 11,182 crore in February and Rs 45,981 crore in March
In March, the overseas investors had pumped in a net Rs 45,981 crore into the capital markets (both equity and debt)
Barring these FPIs from fresh purchases would not have any major impact on investments, say experts
In February as well, foreign portfolio investors were net buyers as they had invested a net amount of Rs 11,182 crore in the capital markets both in equity as well as debt segment
In February, foreign portfolio investors had invested a net amount of Rs 11,182 crore in the capital markets (both equity and debt)
As per the latest data from depositories, foreign investors pumped in Rs 1,17,899.79 cr into equities and pulled out Rs 1,00,680.17 cr in Feb, a net investment of Rs 11,183 cr into the stock market
The market has seen single-day FPI investment of $1.7 billion, the highest in 4 years
Besides cross-border tensions, another major focus area for the FPIs would be the outcome of the general elections
The inflow into the equity market can be a result of the positive view on the Budget