India saw a record inflow of over USD 1.3 billion from listed foreign funds in August, primarily on account of strong capital infusion in passive funds, says a report.
In comparison, listed foreign funds poured in USD 1.2 billion in July after pulling out USD 332 million in the preceding month.
Overall, the country has seen an inflow of USD 545 million so far this year.
“Listed fund flows to India recorded USD 1.34 billion in August with strong inflows in passive funds at USD 845 million,” said a Kotak Institutional Equities report.
India is followed by Taiwan, which attracted an inflow of USD 1 billion.
The listed funds — passive exchange-traded funds (ETFs) and active non-ETFs — generally account for a large part of foreign portfolio investor (FPI) activity in India.
ETFs have seen higher inflows compared with non-ETFs during the month under review. Indian market witnessed inflow worth USD 845 million and USD 499 million in ETFs and non-ETFs segments, respectively.
The report, which offers a comprehensive view on fund flows of listed funds into India and other emerging markets, said net FPI activity across emerging markets remained positive in August.
“Net FPI activity for calendar continues to be positive on the back of other participants, especially sovereign wealth funds (SWFs), whose share in FPI assets under custody remains around 11 per cent in July from 8 per cent a year ago,” it added.
Active Asia (excluding-Japan) funds allocated 14.6 per cent to India in July compared with 14.7 per cent a month ago. Active global emerging markets funds reduced their India exposure to 13.2 per cent from 13.4 per cent in June.