New Delhi: India continues to witness a surge in investments from Foreign Portfolio Investors (FPIs) as they have infused a substantial sum of Rs 153,539 crore in the country during the fiscal year 2023-24, according to official data released by the central government on Monday.
Providing a detailed breakdown, Union Finance Minister Nirmala Sitharaman shared the net Foreign Portfolio Investments (FPI) figures for the past three years and the ongoing financial year. In 2020-21, FPI investments stood at Rs 267,100 crore, while it experienced a dip in 2021-22 at Rs (-) 122,241 crore, and further decreased in 2022-23 to Rs (-) 40,936 crore.
Sitharaman, responding to a question in Lok Sabha today, addressed concerns about the rise in foreign institutional investment in the country. She stated that foreign portfolio investors (FPIs) have consistently remained net buyers in Indian stock markets for the last five months, as indicated by data from the National Securities Depository (NSDL). This influx of foreign funds has significantly contributed to the market's upward trajectory, with various stock indices touching new peaks at regular intervals.
The Finance Minister was also asked about the impact of FPI inflow on inflation in the country. In response, she highlighted that inflation is influenced by multiple factors, such as supply and demand dynamics, input prices, seasonal price changes, and monetary variables like money supply and interest rates.
Data revealed that retail inflation, represented by the Consumer Price Index, averaged 4.6 per cent in the first quarter of 2023-24 (April-June 2023), showing a decline from the 6.2 per cent inflation recorded in the previous quarter (January-March 2023).