Foreign Institutional Investors (FIIs), the main driver of Indian equities, invested more than $20 billion (Re.1, 10, 000 Crore) in the first 11 months this year — the second-highest since 1993 when India had opened the gates for such investors.
A rise in global liquidity, following quantitative easing by central banks in Europe and the US, has driven the money surge into emerging market stocks, including Indian equities. A cheaper rupee also makes Indian markets attractive as FIIs could buy cheaper stocks. The Indian rupee has already fallen 3.27% against the dollar this year.
At $20.10 billion, as per the Securities and Exchange Board of India, the FII investment in Indian equities is the highest since 2010, when a record $29.32 billion had come in.