Global fund investments in India will accelerate in future: Analysts

The Indian stock market has seen a significant rally in recent months and is now attracting global funds which are going to accelerate in the near future, according to top analysts.

The Indian stock market performance has been very impressive for the last one year. National Stock Exchange (NSE) benchmark Nifty surged nearly 6 per cent in the last month, 11.84 per cent in the last six months, 7.65 per cent since the beginning of this year, and nearly 25 per cent in the last one year.

According to Jonathan Garner, Morgan Stanley's Chief Equity Strategist for Asia and Emerging Markets, during the peak of the China markets, the global fund held nearly two to three Chinese e-commerce internet stocks.

"Now they hold two or three mega-cap Indian companies in their portfolio,” he was quoted as saying in media reports.

He further said that the shift has already begun and things are only accelerating from here.

Right now, India is the second-largest emerging market after China. Global investors now prioritise liquidity and can't afford to ignore the Indian stock market, which is booming with retail investments, according to Garner.

On a positive rating action, Fitch's Asia Sovereign Ratings Director Jeremy Zook was quoted as saying in media reports that India's fiscal consolidation strategy beyond 2025-26 to lower the Debt to GDP ratio will play a major role for any kind of a positive ratings action.

The government is targeting a 4.5 per cent fiscal target of GDP by FY26 and 5.1 per cent for the current financial year.