FII inflows in Indian capital market to reduce: Survey

By siliconindia staff writer   |   Wednesday, 26 January 2005, 08:00 Hrs
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NEW DELHI: As dollar regains strength against major currencies and the US interest rates hardens, the crucial FII investment in Indian stock market will slow down in the future, a survey said.

According to a survey by Assocham Business Barometer (ABB), Seventy eight percent of the CEOs are not sure whether the foreign institutional investors will remain positive on India and continue to pour money in 2005 as they did last year.

The portfolio investment had touched 8.8 billion dollars in 2004, not only giving a major boost to the sensex but also triggering a debate whether there should be any cap on the FII inflow.

The CEOs surveyed by ABB are not willing to bet on the FIIs in the wake of high volatility in the market place.

A clear view from the survey was that the inflow to the emerging markets as a whole would slow down with investors again looking to the US since the dollar has started improving and the Federal Reserves keeping the interest stance quite strong.

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