ITRODLCTIO

nrirics covcrcd ly rlc rcrm'!!' includc "vcrscas pcnsion lunds, murual lunds, invcsrmcnr rrusr, asscr managcmcnr
company, nomincc company, lank, insrirurional porrlolio managcr, univcrsiry lunds, cndowmcnrs, loundarions,
clarirallc rrusrs, clarirallc socicrics, a rrusrcc or powcr ol arrorncy loldcr incorporarcd or csrallislcd oursidc !ndia
proposing ro makc propricrary invcsrmcnrs or invcsrmcnrs on lclall ol a lroad-lascd lund orcign porrlolio inllows
rlrougl !!s, in !ndia, arc imporranr lromrlc policy pcrspccrivc, cspccially wlcn rlc counrry las cmcrgcd as onc ol rlc
mosr arrracrivc invcsrmcnr dcsrinarions in Asia. !n rlis papcr an cllorr las lccn madc ro dcvclop an undcrsranding ol rlc
invcsrmcnr dccisions, rrading srrarcgics and lclavior ol rlc !!s inrlc !ndiancquiry markcr.
Wirl rlc cmcrging markcr criscs ol rlc larc 1990s, rlc rolc ol orcign Porrlolio !nvcsrmcnr (P!) and rlc major
playcrs rlcrcin i.c. rlc lorcign insrirurional invcsrors (!!s) las comc undcr inrcnsc scruriny ly acadcmics as wcll as
policymakcrs. A gcncral pcrccprion alour rlc !!s is rlar rlcy arc spccularors and rlcir invcsrmcnr is morivarcd ly slorr-
rcrmgains. 1lc !!s in pursuir ol slorr- rcrmgains adopr slorr- rcrmrrading srrarcgics sucl as posirivc lccdlack rrading
and lcrding (i.c. luy or scll srocks rogcrlcr as a group). Sucl lclavioral liascs ol !!s, ir is lclicvcd, may lcad ro pricc
ovcrrcacrionand conrrilurc rorlc crcarionor cxaccrlarionol a linancial crisis.
!nvcsrmcnr is rlc commirmcnr ol moncy or capiral ro purclasc linancial insrrumcnrs or orlcr asscrs in ordcr ro gain
prolirallc rcrurns in rlc lormol inrcrcsr, incomc, or apprcciarion ol rlc valuc ol rlc insrrumcnr. !nvcsrmcnr is rclarcd ro
saving or dclcrring consumprion. An invcsrmcnr involvcs rlc cloicc ly an individual or an organizarion sucl as a
pcnsion lund. alrcr somc analysis or rlouglr, ro placc or lcnd moncy in a vcliclc, insrrumcnr or asscr, sucl as propcrry,
commodiry, srock, lond, linancial dcrivarivcs (c.g. lururcs or oprions), or rlc lorcign asscr dcnominarcd in lorcign
currcncy, rlar las ccrrain lcvcl ol risk and providcs usc possililiry ol gcncraring rcrurns ovcr a pcriod ol rimc. Wlcn an
asscr is louglr or a givcn amounr ol moncy is invcsrcd in rlc lank, rlcrc is anriciparion rlar somc rcrurn will lc rcccivcd
lromrlc invcsrmcnr in rlc lururc. !nvcsrmcnr comcs wirl rlc risk ol rlc loss ol rlc principal sum. 1lc invcsrmcnr rlar
las nor lccn rlorouglly analyzcd can lc liglly risky wirl rcspccr ro rlc invcsrmcnr owncr lccausc rlc possililiry ol
ITERATIOAL JOLRAL OF MARKETIG,
FIACIAL SERVICES & MAAGEMET RESEARCH
\ol.1 No. 6, {unc, !SSN 2277 S622
Onlinc Availablc at indianrcscarchjournals.com
TRED AALYSIS OF FOREIG ISTITLTIOAL IVESTORS (FIIS)
IVESTMET I IDIA OF MOTHLY FLOWS DLRIG
JALARY 200 - OCTOBER 2011
MR.SARAVAAKRISHA V
Lccturcr, Dcpertmcnt j MBA, CMB lnstitutc j 1cchn/y, Bene/rc
ABSTRACT
1lc oljccrivc ol !!s ro invcsr in any counrry is; rcrurn and salcry ol irs lunds. !crc in rlis papcr rcscarclcrs lavc
madc an arrcmpr ro analyzc rlc rrcnd ol !!s invcsrmcnr in !ndia. 1lc inlormarion rcgarding monrlly and ycarly
invcsrmcnr ly orcign !nsrirurion !nvcsrors (!!'s) in !ndia lavc lccn collccrcd lromrlc !ndia !nlolinc Wclsirc.
1lc pcriod covcrcd undcr rlc srudy is lrom {anuary 2006 ro crolcr 2011.1lc lindings ol rlc srudy indicarc
rlar in 2009 !!s lavc invcsrcd Fs. 91,067.60 Crorcs. Wlilc rlcy lavc wirldrawn Fs.60, 905.90 Crorc in 2008
rlis is duc ro rlc cllccr ol glolal mclrdown and rcccssion in world cconomy. uring rlc srudy wc lound rlar
Markcr sizc, Polirical sccnario, alour cosr and producriviry, ilcralizcd 1radc Policy, !nlrasrrucrurc, !nccnrivcs
andpcraring condirions andisinvcsrmcnr policy wcrc rlc causcs ol !!s invcsrmcnr in!ndia.
Kcywords : quiry andclr, !! - orcign!nsrirurional !nvcsror, !ndianconomy and1rcndAnalysis.
63
losing moncy is nor wirlin rlc owncr's conrrol. 1lc dillcrcncc lcrwccn spccularion and invcsrmcnr can lc sulrlc. !r
dcpcnds on rlc invcsrmcnr owncr's mind wlcrlcr rlc purposc is lor lcnding rlc rcsourcc ro somconc clsc lor cconomic
purposc or nor. !nvcsrmcnr can lc madc ly a Pcrson rcsidcnr in !ndia and an cnriry rcsidcnr our ol !ndia or orcign
!nsrirurional !nvcsrors (!!s)
!ndia opcncd irs srock markcr ro lorcign invcsrors in Scprcmlcr 1992 and in 199S rcccivcd porrlolio invcsrmcnr
lromlorcigncrs in rlc lormol lorcign insrirurional invcsrmcnr in cquirics. 1lis las lccomc onc ol rlc main clanncls ol
!1 in !ndia lor lorcigncrs. !nirially, rlcrc wcrc many rcrms and condirions wlicl rcsrricrcd many !!s ro invcsr in !ndia
lur in rlc coursc ol rimc, in ordcr ro arrracr morc invcsrors SB! las simplilicd many rcrms sucl as rlc cciling lor ovcrall
invcsrmcnrs ol !!s.
!!'s (orcign !nsrirurional !nvcsrors) is uscd ro dcnorc an invcsror. ir is mosrly ol rlc lorm ol an insrirurion or
cnriry wliclinvcsrs moncy inrlc linancial markcrs ol a counrry. 1lc rcrm!! is mosr commonly uscd in!ndia rorclcr ro
companics rlar arc csrallislcd or incorporarcd oursidc !ndia, and is invcsring in rlc linancial markcrs ol !ndia. 1lcsc
invcsrors musr rcgisrcr wirl rlc Sccurirics & xclangc Board ol !ndia (SB!) ro rakc parr in rlc markcr. nrirics
covcrcd ly rlc rcrm'!!' includc "vcrscas pcnsion lunds, murual lunds, invcsrmcnr rrusr, asscr managcmcnr company,
nomincc company, lank, insrirurional porrlolio managcr, univcrsiry lunds, cndowmcnrs, loundarions, clarirallc rrusrs,
clarirallc socicrics, a rrusrcc or powcr ol arrorncy loldcr incorporarcd or csrallislcd oursidc !ndia proposing ro makc
propricrary invcsrmcnrs or invcsrmcnrs onlclall ol a lroad-lascdlund.
orcign !nsrirurional !nvcsrors (!!s) arc allowcd ro invcsr in rlc primary and sccondary capiral markcrs in !ndia
rlrougl rlc Porrlolio !nvcsrmcnr Sclcmc (P!S) adminisrcrcd ly rlc Fcscrvc Bank ol !ndia (FB!). \ndcr rlis sclcmc
!!s canacquirc slarcs}dclcnrurcs ol !ndiancompanics rlrougl rlc srock cxclangcs in!ndia.
!ndia, wlicl is rlc sccond lasrcsr growing cconomy alrcr Clina, las larcly lccn a major rccipicnr ol orcign
!nsrirurional !nvcsror (!!) lunds drivcn ly rlc srrong lundamcnrals and growrl opporrunirics. According ro analysrs,
rlc larc rcvival ol monsoon, upward rcvision ol cconomic growrl lrom 5.8 pcr ccnr ro 6.1 pcr ccnr, lcrrcr-rlan-
cxpccrcd pcrlormancc ol companics in rlc quarrcr cndcd-{unc S0, rlc ncw dirccr raxcs codc, lcading ro savings in rlc
rax paycr's moncy, and rlc rradc policy wirl an amlirious rargcr ol \SS 200 lillion cxporrs lor 2010-11 lavc all rcvivcd
rlc conlidcncc ol !!s invcsring in !ndia. Borl consumprion and invcsrmcnr-lcd indusrrics linkcd ro domcsric dcmand,
sucl as auro, lanking, capiral goods, inlrasrrucrurc and rcrail, arc likcly roconrinuc arrracring !! lunds.
TREDAALYSIS
1lc rcrm"rrcnd analysis" rclcrs ro rlc conccpr ol collccring inlormarion and arrcmpring ro spor a parrcrn, or rrcnd, in
rlc inlormarion. !nsomc liclds ol srudy, rlc rcrm"rrcnd analysis" las morc lormally-dclincdmcanings.
!n projccr managcmcnr rrcnd analysis is a marlcmarical rcclniquc rlar uscs lisrorical rcsulrs ro prcdicr lururc
ourcomc. 1lis is aclicvcd ly rracking varianccs in cosr and sclcdulc pcrlormancc. !n rlis conrcxr, ir is a projccr
managcmcnr qualiry conrrol rool. 1lc analysis ol a variallc's pasr valuc clangcs ro dcrcrminc il a rrcnd cxisrs and il so.
Wlar rlc rrcnd indicarcs A rcclnical analysr may grapl a srock's pricc rlrouglour a pcriod ol rimc ro dcrcrminc
wlcrlcr a rrcnd las lccn csrallislcd. 1lis is a rypc ol rcclnical analysis rlar is uscd }or arrcmpr ro prcdicr rlc lururc
movcmcnr ol a srock or insrirurional ol lund.
OBJECTIVES
1) 1olind our rlc causcs lor invcsrmcnr ly orcign!nsrirurional !nvcsrors (!!s) in!ndia.
2) 1oknowrlc rrcnd ol invcsrmcnr ol orcign!nsrirurional !nvcsrors in!ndia.
S) 1osrudy rlc scopc and rrading mcclanismol orcign!nsrirurional invcsrors in!ndia.
MR.SARAVAAKRISHA V
6+
+) 1osrudy rlc Corrclarionol cquiry llowand clr llowol orcign!nsrirurional invcsrors in!ndia.
RESEARCH METHODOLOGY
ur cnrirc srudy is lascd on sccondary dara and rclcvanr sccondary dara lavc lccn collccrcd lromvarious looks, journal
and wcl sircs. 1lc inlormarion rcgarding monrlly and ycarly invcsrmcnr ly orcign !nsrirurion !nvcsrors (!!'s) in
!ndia lavc lccn collccrcd lrom rlc SB!, !ndia !nlolinc and Moncy conrrol wclsircs. 1lc pcriod covcrcd undcr rlc
srudy is lrom{anuary 2006 ro crolcr 2011. Wc lavc uscd 1rcnd Analysis 1cclniquc ly wlicl wc would allc ro know
rlc rrcnd ol invcsrmcnr ly !!'s.
1rcnd analysis is uscd ro prcdicr a rrcnd ol invcsrmcnr in lururc and know rlc impacr ol pasr in prcscnr or in lururc. !n
rrcnd analysis onc can also compurc rlc pcrccnragc and knowrlc rcsulrs alour lururc. !crc rlc purposc ol using rrcnd
analysis is rodcrcrminc and lind rrcnd ol !!s invcsrmcnr in!ndia.
TREDAALYSISOF FII'S
Tablc -1 FII Invcstmcnt in India in 200
Months Equity Dcbt
{an-06 S,220.70 -869.5
cl-06 7,571.90 -151.6
Mar-06 6,5S2.S0 -21+.5
Apr-06 589.2 2S5.8
May-06 -8,2+7.20 706.8
{un-06 1,+18.20 S95.7
{ul-06 1,++7.90 82.+
Aug-06 +,77+.00 811.6
Scp-06 6,2S1.70 628.S
cr-06 +,578.5+ 1,066.65
Nov-06 6,57+.7+ 88+.SS
cc-06 -S,+10.90 5S.2
Chart - 1
Amount in Crorcs
TRED AALYSIS OF FOREIG ISTITLTIOAL IVESTORS (FIIS) IVESTMET I IDIA OF
MOTHLY FLOWS DLRIG JALARY 200 - OCTOBER 2011
6S
1allc 1 rcvcals rlar in rlc ycar 2006 !!s cquiry inllowwas lcss rlan in comparison ro ourllowi.c. !!s lavc wirldrawn
rlc liglcsr amounr lor rlc ycar. !!s wirldrcw Fs. 8,2+7.20 Crorc in May, 2006 lollowcd ly cc. 2006. !nllow ol
lunds ly !!s in!ndia was liglcsr incl. 2006i.c. Fs. 7,571.90Crorc lollowcdly Fs. 6,57+.7+incl. 2006.
Chart - 2
ifty VS FII Equity for 200

Tablc -2 FII Invcstmcnts in India in 2007
Months Equity Dcbt
{an-07 9+.+5 -1,7+7.57
cl-07 6,065.00 +21.5
Mar-07 1,+0S.S0 2,16+.00
Apr-07 5,+S1.80 620.1
May-07 +,57+.50 1,S60.10
{un-07 7,9S9.60 -772
{ul-07 18,1S2.80 -1,101.60
Aug-07 -7,526.80 +71.S
Scp-07 18,9+8.50 2,775.50
cr-07 15,577.60 2,088.20
Nov-07 -+,597.+0 -S91.+
cc-07 +,896.70 S,261.00
MR.SARAVAAKRISHA V
66
Chart - 3
Amount in Crorcs
!n rlc ycar 2007, !!s avcragc inllows and ourllows ol lunds lor cquiry wcrc vcry ligl. !!s invcsrmcnr ro cquiry was
liglcsr Fs 18,9+8.50 Crorc and Fs. 18,1S2.80million in {uly 2007 and Scp. 2007 rcspccrivcly, wlilc !!s lavc
wirldrawnrworimcs inrlc samc ycar i.c. Fs. 7,526.80Crorcs inAugusr. Fs. +,597.+0Crorc inNov. 2007.Wl c r c a s ,
!!s wirldrawn lromdclr rlricc in 2007. 1lc !!s invcsrmcnr inllowlas incrcascd ro Fs. S,261.00 Crorcs in cccmlcr
2007.
Chart - 4
ifty VS FII Equity for 2007
TRED AALYSIS OF FOREIG ISTITLTIOAL IVESTORS (FIIS) IVESTMET I IDIA OF
MOTHLY FLOWS DLRIG JALARY 200 - OCTOBER 2011
67
Tablc -3 FII Invcstmcnts in India in 2008
Months Equity Dcbt
{an-08 -17,S26.S0 1,8+2.70
cl-08 5,+19.90 2,+96.80
Mar-08 12+.+ -879.7
Apr-08 979 -1,701.70
May-08 -+,917.S0 -162.9
{un-08 -10,577.70 -826.9
{ul-08 -1,012.90 S,59+.80
Aug-08 -2,065.80 1,188.70
Scp-08 -7,9S7.00 S,090.+0
cr-08 -1+,2+8.60 -2,0+7.50
Nov-08 -2,820.S0 5,+0+.60
cc-08 1,SS0.90 S+1.1
Chart - 5
Amount in Crorcs
1allc S slows cquiry ourllowrrcnd rlrouglour rlc ycar. !n {an. 2008 !!s lavc wirldrawn Fs. 17,S26.S0 Crorc wlicl
was rlc liglcsr amounr wirldrawn in 2008. !nllow ol lunds was quirc lcss. Wlcrcas, rlc dclr inllow was quirc good
comparing ro cquiry inllow. !n rlc monrl ol Novcmlcr rlc clr inllowwas vcry good, wlcrcas rlc cquiry las ourllow
duc rorcccssion.
MR.SARAVAAKRISHA V
68
Chart -
ifty VS FII Equity for 2008
Tablc -4 FII Invcstmcnts in India in 200
Months Equity Dcbt
{an-09 -S,009.50 -168.8
cl-09 -2,690.50 -S69.1
Mar-09 269 -6,+81.90
Apr-09 7,S8+.20 2,68+.50
May-09 20,606.90 -2,798.60
{un-09 S,22+.90 7+S.8
{ul-09 11,625.S0 2,S61.20
Aug-09 +,028.70 -+8+.+
Scp-09 19,9S9.50 2,122.+0
cr-09 8,S0+.10 7,0+6.S0
Nov-09 5,S17.80 2S6.8
cc-09 10,S67.20 -1,+SS.80
Chart - 7
Amount in Crorcs
TRED AALYSIS OF FOREIG ISTITLTIOAL IVESTORS (FIIS) IVESTMET I IDIA OF
MOTHLY FLOWS DLRIG JALARY 200 - OCTOBER 2011
69
Ycar 2009 was good lrom!ndia's poinr ol vicw lccausc in 2009 !!s invcsrmcnr las lccn liglcsr sincc 200+. !n May,
2009 !!s invcsrcd Fs. 20,606.90 crorc lollowcd ly Fs. 19,9S9.50 crorc in Scp.2009. !!s lavc wirldrawn rwo rimcs
i.c. in{an. and cl. 2009.
Wlcrcas dclr markcr ourllowwas morc, ina ycar !!'s las wirldrawnmorc dclr and invcsrcd in!!.
Chart - 8
ifty VS FII Equity for 200

Tablc -5 FII Invcstmcnts in India in 2010
Months Equity Dcbt
{an-10 5,902.+0 11,56+.50
cl-10 2,11S.50 2,209.80
Mar-10 18,8SS.60 10,1S6.70
Apr-10 9,76+.50 5,226.10
May-10 -8,629.90 5,716.00
{un-10 10,2++.60 95.+
{ul-10 17,120.60 8,1S7.S0
Aug-10 11,185.S0 1,988.+0
Scp-10 29,195.80 7,625.S0
cr-10 2+,770.80 -+,521.10
Nov-10 18,519.90 S,975.90
cc-10 1,+76.10 2,288.50
MR.SARAVAAKRISHA V
70
Chart -
Amount in Crorcs
!!s inllow ro cquiry was quirc sarislacrory in 2010 as ir was in 2009. !!s invcsrmcnr was Fs. 29,195.80 crorc and
Fs2+,770.80 crorc in Scprcmlcr and crolcr rcspccrivcly. !!s lavc wirldrawn Fs. 8,629.90 Crorc in May,
2010.Aslo2010ccnrral clccrionrcsulrs lrouglr lack rlc lullislrrcnd inrlc markcr.
!! inllowro dclr was quirc sarislacrory rlrouglour rlc ycar 2010. !! lavc wirldrawn Fs. +,521.10 crorc in crolcr
2010.
Chart - 10
ifty VS FII Equity for 2010

TRED AALYSIS OF FOREIG ISTITLTIOAL IVESTORS (FIIS) IVESTMET I IDIA OF
MOTHLY FLOWS DLRIG JALARY 200 - OCTOBER 2011
71
Tablc - FII Invcstmcnts in India in 2011
Months Equity Dcbt
{an-11 -6,SS0.20 11,086.+0
cl-11 -S,75+.50 -1,775.20
Mar-11 6,966.70 2,S02.10
Apr-11 7,018.50 -+58.S
May-11 -5,158.20 2,6+8.10
{un-11 S,172.10 1,S08.S0
{ul-11 7,+11.10 2,66+.70
Aug-11 -10,21+.60 2,888.80
Scp-11 -1,1+7.00 -1,251.80
cr-11 2,+68.80 1,189.+0
Chart - 11
Amount in Crorcs

!! wirldrcwlor ol moncy lromcquiry in rlis ycar; ir's a lad ycar lor markcr. vcn rlc inllowis nor good, comparing ro
rlc ycar 2010. Wlcrcas, rlc dclr inllow was quirc good comparing cquiry llow. \cry lcw ourllow ol lunds in dclr
markcr alsolound.
MR.SARAVAAKRISHA V
72
Chart - 12
ifty VS FII Equity for 2010
Tablc -7 FII Invcstmcnts in India Ycar Wisc
Ycar Equity Dcbt
2006 S1,281.08 S629.18
2007 709+0.05 91+9.1S
2008 -5S051.7 12S+0.+
2009 85S67.6 S+58.+
2010 1+0+97.2 5+++2.8
2011 +S2.7 20602.5
Chart - 7
Total Flow of FII (ycar wisc)

TRED AALYSIS OF FOREIG ISTITLTIOAL IVESTORS (FIIS) IVESTMET I IDIA OF
MOTHLY FLOWS DLRIG JALARY 200 - OCTOBER 2011
73
FIDIGS
Wc lound rlar in 2009 !!s lavc invcsrcd Fs. 88,826 Crorcs in lorl cquiry and dclr. Wlilc rlcy lavc wirldrawn
Fs. -5S,051.70 Crorcs in 2008 ir was rlc cllccr ol glolal mclrdown or rcccssion in world cconomy. Bur lor dclr
markcr rlc inllowol !! was quirc good comparing cquiry. " 1lc !! vs quiry rallcs slow rlar !!s lavc lcss
impacr on!ndiansrock indiccs and orlcr uncxplaincdvariallcs arc alsoinllucncing rlc !ndiccs.
Wc loundrlar in2008!!'s lavc invcsrcd lowcsr amounr incquiry ol Fs. 7,85+.20crorc.
Wc loundrlar inclarr - 7sincc 2006rlcrc is noourllowol !! lor clr markcr.
Wc loundrlar rlcrc is nocorrclarionlcrwccncquiry and dclr llowol !!.
Wc lound rlar domcsric sourccs ol oursidc linancc arc limircd in many counrrics, parricularly rlosc wirl cmcrging
markcrs. 1lrougl capiral markcr lilcralizarion, lorcign capiral las lccomc incrcasingly signilicanr sourcc ol
linancc.
Wc also lound rlar !!s !nvcsrmcnr is dcpcnd on rlc cconomic condirion ol rlc narion, as wc can olscrvc lrom
rallc-Srlar during rlc rimc ol cconomic rcccssion!!s lavc wirldrawnrlcir maximumamounr.
As rallc 8 slows rlar rlcrc was liglcsr inllowol lunds ly !!s in 2009. nc ol rlc rcasons was rlc growrl ol srock
markcr. 1lc !! moncy lound irs way ro rlc dillcrcnr linancial asscr classcs, including cmcrging !ndian capiral
markcrs.
1lc main rcason wly !!s pur rlcir moncy in !ndia is lccausc goods and providing scrviccs ar a lowcr cosr. 1lc
scarciry cmploymcnr opporrunirics can casily lirc a wcll qualilicd or cvcn an ovcr qualilicd prolcssional ar lowcr
cosr.
uring rlc srudy wc lound rlar Markcr sizc, Polirical sccnario, alour cosr and producriviry, ilcralizcd 1radc
Policy, !nlrasrrucrurc, !nccnrivcs and pcraring condirions and isinvcsrmcnr policy wcrc rlc causcs ol !!s
invcsrmcnr in!ndia.
COCLLSIO
1lc imporranr rcsulr ol rlis analysis is rlar rlc !!s invcsrmcnr lclaviors arc dcrcrmincd ly srock markcr rcrurn and risk
in and cconomic lacrors ol !ndia. !!s invcsrmcnr dccisions arc nor major lacrors lor srock markcr loom and crasl in
!ndia lur rlcrc arc numcrous orlcr rcasons wlicl dcrcrminc rlc rrcnd ol !!s inllows and ourllows lromand in !ndia. As
wc lavc sccing rlar !ndia's rapid annual growrl rarc ol morc rlan 8 pcr ccnr is rcllccrcd in rlc pcrlormancc ol lunds
invcsring in rlc counrry. !n 2008 !!s lavc wirldrawn Fs.60, 905.90 Crorc and on rlc conrrary !!s invcsrcd Fs.91,
067.60 Crorcs in 2009 wlicl rcllccr rlar srrong cconomic condirions plays vcry viral rolc in inllucncing !!s inllows in
rlc counrry. nc ol rlc impacrs ol Glolal Mclrdown las lccn olscrvcd during rlc ycar 2007-08 wlilc in rlc ycar 2009
!!s lavc again inlusc moncy inro rlc !ndian linancial markcr lccausc rlcy may prcdicr rlc posirivc signs ol Growrl ol
!ndian conomy. Nowadays !!s arc rlc major conrrilurors ro rlc srock markcrs. 1lc pros ol allowing !!s ro invcsr in
rlc !ndian markcrs lar ourwcigl rlc cons. Simply lanning parriciparory norcs cannor lc a solurion. !r is up ro rlc policy
makcrs ol !ndia ro allowro opcrarc and providc rlcmwirl morc opporrunirics and rcasons ro invcsr in !ndian markcrs.
omcsric sourccs ol oursidc linancc arc limircd in many counrrics, parricularly rlosc wirl cmcrging markcrs. 1lrougl
capiral markcr lilcralizarion, lorcign capiral las lccomc incrcasingly signilicanr sourcc ol linancc. Sincc !ndia is a lalour
inrcnsivc counrry. 1lcrclorc, in dcvcloping counrrics likc !ndian lorcign capiral lclps in incrcasing rlc producriviry ol
lalour and ro luild up lorcign cxclangc rcscrvcs ro mccr rlc currcnr accounr dclicir. orcign !nvcsrmcnr providcs a
clanncl rlrougl wlicl counrry can lavc acccss ro lorcign capiral. !r is rcquircd ro undcrsrand wlcn rlcy wirldrawrlcir
lunds and wlcn rlcy pump in morc moncy. !iglcr Scnscx indiccs and ligl pricc carnings rario arc rlc counrry lcvcl
lacrors arrracring morc lorcign invcsrmcnr in !ndia. ur srudy rcvcals rlar rlcrc is a growrl rrcnd in !!s invcsrmcnr in
MR.SARAVAAKRISHA V
7+
!ndia. !nvcsrmcnr ol !!s kcpr on growing lrom 2006 ro 2009. 1lcrc is no impacr ol !! lor clr markcr also. 1lc
clr markcr incnrircly dcpcnds onrlc rarcs ol rlc counrry.
REFERECES
1. Agarwal, Clakarlarri and 1rivcdi & Nair (200S), crcrminanrs ol lls !nvcsrmcnr !nllow ro !ndia. Papcr
Prcscnrcd in 5rl Annual Conlcrcncc on Moncy & inancc in rlc !ndia conomy, !ndira Gandli !nsrirurc ol
cvclopmcnr Fcscarcl, {an. S0-cl. 1, 200S.
2. avid Carpcnrcr, Parrncr Maycr, Brown, Fow & Maw P (2005), orcign !nvcsrmcnr in !ndia, {ournal ol
inancial Fcscarcl, \ol. 19.
S. lamija Nidli (2007), orcign !nsrirurional !nvcsrmcnr in !ndia, {ournal ol Fcscarcl in !ndian Srock \olariliry,
\ol.1+.
+. Srancly Morgan(2002), lls inllucncc onSrock Markcr. {ournal ol !mpacr on!nsrirurional !nvcsrors, \ol. 17.
5. www.Scli.gov.in
6. www.moncyconrrol.com
TRED AALYSIS OF FOREIG ISTITLTIOAL IVESTORS (FIIS) IVESTMET I IDIA OF
MOTHLY FLOWS DLRIG JALARY 200 - OCTOBER 2011
7S