New Delhi: Call it the effect of the Congress-led UPA government or a hope of a revival for the Indian stock markets, the country has witnessed an inflow of nearly Rs23,700 crore from overseas investors since the new term of Prime Minister Manmohan Singh.
An analysis of the foreign institutional investors (FIIs) activity shows that since 22 May, the day Prime Minister took oath for a second term to lead the United Progressive Alliance government, FIIs have made a net investment of Rs23,688.8 crore in the domestic stock markets.
On 29 August, the UPA government completed its 100 days in office with a mixed bag of good work on certain fronts while stumbling on several issues.
The inflow during the period (22 May-29 August) accounts for over 65% of the total FII inflow into the Indian stock markets.
According to the data available with market regulator Securities and Exchange Board of India (Sebi), so far in 2009 FIIs have made a net investment of Rs39,179.60 crore.
During the period under review, July witnessed an inflow of Rs11,066 crore, the highest in a month. In June the inflow was Rs3,830 crore, while in August it is Rs3,810 crore.
“FIIs have confidence in the India growth story and have invested at a cheaper level. Now that markets have moved up more participation would be seen as the foreign funds would like to be left out for participating in the rally,” SMC Global vice president Rajesh Jain said.
During the same period, Bombay Stock Exchange’s benchmark index Sensex gained 15% to 15,922.34 level. On 22 May, Sensex had ended at 13,887.15.
The government’s 100-day programme reflected the Prime Minister’s words who made it clear to his Cabinet colleagues that ‘business as usual will not do´.
The Union Budget 2009-10, presented by finance minister Pranab Mukherjee sought to double the outlays for rural development at a time of sluggish growth, which is expected to be 6% this year.
The government has also come out with a new Direct Taxes Code, which promises to simplify direct tax laws and promises to put more money in the pocket of the tax payer. It also came out with a Trade Policy with an ambitious target of $200 billion exports for 2010-11.