However, the fund has accepted that its asset management division was a net seller during the period between October 5-9, and this was attributed to the redemption pressures from its non-India dedicated funds, along with changing global asset allocations in the emerging markets asset class.

"Being the largest foreign institutional investor in the country, we have invested about $1.3 billion (Rs 5,600 crore) in the market on behalf of our clients. Given the size of our assets here, the scale of our trading activity is large. While there were times when we were the net sellers, there has been a period when we were the significant net buyers as well," explained Morgan Stanley India president Vikram Gandhi.

"As reported, I met finance secretary Vijay Kelkar yesterday. Our discussions centered around Morgan Stanley's business in India. But, it didnot include any reference to our activities in Thailand. Kelkar mentioned that he welcomes the presence of a well-respected, large and global financial services firm like Morgan Stanley," he added.

Gandhi also emphasised on the theme of his conversation with Kelkar which centered around the role of FIIs in an era of increasing capital and technology inflows into India.

The Morgan Stanley chief said that while a majority of the money under management with Morgan Stanley Asset Management India (MSAM) was through the India dedicated funds, the rest was from allocations made out of the emerging market Asia dedicated funds, which were raised by Morgan Stanley Dean Witter from its institutional clients.

"The redemption pressures on fund managers worldwide are intense making it necessary to raise cash at a short notice," said Gandhi. Morgan Stanley India operates in three main business areas--asset management, investment banking and equity sales.

MSAM manages two major offshore funds--the India Magnum Fund(traded on the Dublin Stock Exchange) and the India Investment fund (traded on NYSE).

It also manages India's largest, private sector mutual fund, the Morgan Stanley Growth Fund, which has set the industry standard in the Indian fund management business for investor service, disclosure and fiduciary responsibility to investors.

Morgan Stanley India had also joined hands with JM Financial group for investment banking and institutional equity sales and trading business in India.