India records highest FII inflows among emerging markets in 2020

India records highest FII inflows among emerging markets in 2020

Indian equities received more than Rs 1.6 lakh crore ($23 billion) from foreign institutional investors in 2020, the highest among emerging markets. In fact, most Asian and emerging markets witnessed outflows in the year gone by.

This was the second year in a row when FII inflows into Indian equities were highest among emerging markets. In 2019, the inflow was $14.2 billion.

Some of the factors that are attracting FIIs to the India story are rising hopes for strong economic recovery and earnings growth in coming years, significant decline in COVID-19 cases at a time when the western world (especially US and European nations) is still struggling with second wave, weak dollar index, vaccine progress, and government & RBI policy stimulus measures.

Globally, central banks announced stimulus measures worth trillions of dollars during 2020 to boost their economies which were hit by the outbreak of COVID-19 and lockdown measures.