Foreign Institutional Investors (FIIs) and global fund managers are starting to lose interest in China. The majority of these investors arrived in China after Covid to take advantage of the fantastic opportunity. They are taking their money out of China’s stock market and investing it in India instead since demand and GDP are declining. 2023: 1.47 lakh crore so far. The stock market has seen foreign investment, which is at its highest level in the past six years.  Additionally, the first quarter (April, May, and June) of the current fiscal year saw a $ 9 billion (₹ 73,800 crore) inflow from this source. The globe wants to lessen its reliance on China as a source of supplies, which is the major driver behind this. Large corporations are departing as a result.

According to depository statistics, international investors have this time visited India for a longer period of time. Here, they make about ₹ 1400 crore each day. Foreign investors are not overly bullish about China’s economy for the next ten years. In India, people are looking toward the future. Investors from the United States and Europe are also included. In May, foreign investors sold shares from Chinese bourses for $1.71 billion. It was $659 million in May of last year.

$84.35 billion in foreign direct investment was made into China in just 5 months, a 5.6% yearly fall. The expected return from China was not received once the Covid ban was lifted. For this reason, PE funds from companies like Nevsky, Blackrock, Vanguard, Sequoia, Combinator, and Softbank arrived in India. Singapore, Mauritius, America, the United Arab Emirates, and the Netherlands made the most investment.

Due to increased trust in China’s opening up following Covid, Foreign Institutional Investors (FIIs) sold the largest amount of shares in our stock market in 2022, totaling ₹ 1.25 lakh crore. The situation has now changed. The GDP of India is rising. Institutional investors from outside are coming because of this. Recently, Morgan Stanley downgraded China while upgrading the Indian economy.

Why are they choosing India?

1- The Sensex has returned investors 7.82% so far this year. Shanghai Stock Exchange Composite (SSE) of China could only yield 0.25%.

2- In relation to the Indian rupee, the Chinese yuan’s value has dropped by 5.16 percent. One yuan was worth ₹ 12.20 on February 7; it is currently worth ₹ 11.57.

3- One dollar used to cost 6.74 yuan in January; today it costs 7.19 yuan. In other words, the yuan lost value relative to the dollar by 6.67%.

4- A dollar is currently worth ₹ 82.73 as opposed to ₹ 82.71 on January 2^nd, 2023. That means, our rupee’s value barely dropped by 0.024%.