According to the Ministry of Finance, it reflects the conviction of foreign investors in the fundamentals of the Indian economy.
The Ministry of Finance said on Tuesday that India witnessed strong foreign portfolio investment (FPI) in equity markets during 2020-21, during the outbreak of COVID-19, during the period 2,74,034 crore.
The ministry said in a statement, “This reflects the conviction of foreign investors in the fundamentals of the Indian economy.”
During the financial year 2020-21, only April and September saw outflows of ₹ 6,884 crore and ₹ 7,783 crore respectively.
“Strong FPI flows lagged faster than expected economic recovery supported by multiple phases of economically designed stimulus packages. Government and regulators recently announced major policy reforms to improve access and investment climate for FPIs Had taken the initiative., “It said.
This includes simplification and rationalization of FPI regulatory regime, registration of Online Common Application Form (CAF) with SEBI, allocation of PAN and opening of bank and demat accounts etc.
The increase in the total FPI investment limit from 24 percent to sectoral cap in Indian companies has been a catalyst for the increase in the weight of Indian securities in key equity indices, thus leading to large-scale equity inflows, both passive and active Indian capital. Gathering in the market , It was added.
The statement further said that the growth forecast for India in 2021-22 has been pegged at over 10 percent by the World Bank, IMF and several global research organizations, who believe that India will remain an attractive investment destination in the near future .
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