Foreign institutional Investment (FII) in India: Definition and Statistics

Published Aug 4, 2023

"Rising Tide of Foreign Institutional Investment (FII) in India: A Look at the Current Trends and Impact on the Economy "

Definition: A foreign institutional investor is an investor in a financial market outside its official home country. Foreign institutional investors can include pension funds, investment banks, hedge funds, and mutual funds.
Why FII Important: Foreign Institutional Investors is an institutional, individual or group entity seeking to invest in the economy of a country other than where the entity is headquartered. Flls are important to emerging economies because they bring funds and capital to businesses in developing countries.
Importance: FIIs are vital in nurturing capital markets as they provide global exposure and expertise in addition to capital. Their investments enhance market efficiency, depth, liquidity, boosting confidence and attracting further investments.
Benefits of FII: Fll's will increase capital inflows into the country. They also contribute to economic development by making long-term capital available for projects. FII focuses on equity rather than debt which helps in maintaining and improving the capital of the company they are investing in.

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