NEW DELHI: 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.
This reflects steadfast confidence of foreign investors in the fundamentals of the Indian economy, the ministry said in a statement.
During the financial year 2020-21, only in April and September there were outflows of Rs 6,884 crore and Rs 7,783 crore respectively.
“The robust FPI flows came on the back of faster than expected economic recovery supported by multiple tranches of innovatively designed stimulus packages. 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 rationalisation of the FPI regulatory regime, operationalisation 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.
The increase in aggregate FPI investment limit in Indian companies from 24 per cent to the sectoral cap has been a catalyst for the increase in weightage of Indian securities in major equity indices, thus mobilising massive equity inflows, both passive and active, into Indian capital markets, it added.
The statement further said the growth forecast for India in 2021-22, have been pegged above 10 per cent by the World Bank, IMF and several global research organisations underscoring that India will continue to remain an attractive investment destination in the near future.