FPIs invest Rs. 2.74 lakh crore in equity markets during FY’21

FPIs: A foreign portfolio investment is a grouping of assets such as stocks, bonds, and cash equivalents. Portfolio investments are held directly by an investor or managed by financial professionals. The Finance Ministry on Tuesday said India witnessed strong Foreign Portfolio Investment (FPI) inflows into the equity markets to the tune of Rs. 2,74,034 crore, During 2020-21, despite the outbreak of COVID-19.

Moreover, this reflects loyal confidence of foreign investors in the fundamentals of the Indian economy, the Ministry said in a statement. Through the financial year 2020-21, only in April and September there were outflows of Rs. 6,884 crore and Rs. 7,783 crore respectively.

On the other side, the strong FPI flows came on the back of faster than expected economic recovery. Supported by multiple tranches of innovatively designed stimulus packages. While the government and regulators had also undertaken major policy. Initiatives directed at improving ease of access and investment climate for FPIs in the recent past, it said.

These include simplification and rationalization of the FPI regulatory regime, operationalization of the online Common Application Form (CAF) for the purpose of registration with SEBI. Allotment of PAN, and opening of bank and Demat accounts, etc, it said. While the increase in aggregate FPI investment limit in Indian companies from 24 percent. The sectoral cap has been a catalyst for the increase in weightage.

Indian securities in major equity indices, thus mobilizing massive equity inflows, both passive and active into Indian capital markets, it added. The statement further said the growth forecast for India in 2021-21. While it has been pegged above 10 percent by the World Bank. IMF and several global research organizations underscoring that India will continue to remain an attractive investment destination in the near future.