BJP's win in assembly elections boosts foreign investment by Rs 1,800 crore in May

Foreign investors have pumped in nearly Rs 1,800 crore into Indian equities so far this month on good performance of the BJP in assembly elections which is likely to enhance the central government's ability to push through legislative reforms.

Interestingly, Foreign Portfolio investors (FPIs) invested Rs 341 crore into equities on May 19, the day assembly elections results were announced.

In March-April, Foreign Portfolio Investors (FPIs) had poured in Rs 29,558 crore into the markets.

BJP coming to power in Assam for the first time and improvement in its seat tally in West Bengal and Kerala is likely to enhance the central government's ability to push through legislative reforms, said Shreyash Devalkar Fund Manager Equities at BNP Paribas Mutual Fund.

The data sourced from the depositories showed FPI have invested Rs 1,795 crore in the Indian stock markets so far this month.

However, foreign investors have pulled out Rs 3,496 crore from the debt markets during the period under review.

Capital poured in by FPIs is often referred to as 'hot money' because of its unpredictability, although they continue to remain among the most important drivers of Indian stock markets.

This year, FPIs have invested Rs 14,706 crore in equities while withdrawing Rs 4,436 crore from debt market, resulting in a net inflow of Rs 10,270 crore.