Reforms by new RBI chief seen in net investment inflows into the country

September 29
10:49 AM 2013

Over INR 13,000 crore or USD2 billion, overseas investors have been infused into the Indian stock market this month after the announcement made by RBI Raghuram Rajan's on measures undertaken to shore up the weakened rupee and boosting the economy towards recovery. 

Another positive note for the economy is the decision by the US Federal Reserve's to retain its current course of its stimulus programmes. This encouraged foreign investors to put their funds into Indian equity investments. The inflows in equities were worth INR13,228 crore or USD2,09 billion between September 2 and 27, and there remains only one trading session for the month.

In the reverse, there was a pull-out amounting to INR6,016 or USD965 million from the Indian debt market, with a retention volume of INR7,213 crore or USD1.12 billion according to SEBI data. The inflows were followed by a nearly INR16,000 crore or USD2.5 billion in withdrawals from the domestic capital markets in August.

The renewed purchases by Foreign Institutional Investors or FIIs was seen after Rajan came in as the new Reserve Bank of India head through the announcement of a list of measures to attract capital flows and boost economic growth.

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