India has witnessed an outflow of $2 billion from listed foreign funds in the first four months this year.
Listed funds (passive exchange traded funds (ETFs) and active non-ETFs), account for a large part of Foreign Portfolio Investors (FPI) activity in India.
“For calendar year 2016, India has seen listed fund outflows worth USD 2 billion with equal contribution from passive and active participants,” as per Kotak Institutional Equities report, which gives comprehensive view on fund flows of listed funds into India and other emerging markets.
India-focused active funds saw outflows worth USD 902 million, while their passive counterparts pulled out USD 1.09 billion during the period.
Despite listed funds outflow, the FPI activity in the region remained upbeat as other participants remained active. They have pumped in USD 1.3 billion into Indian market during the period under review.
“FPI AUC (assets under custody) suggests that 20 per cent of India’s total FPI AUC is owned by riskier market participants (which include broad-based funds), up 1.4 per cent since March 2015.