FIIs pump Rs 5,400 cr into stock mkts in Nov

New Delhi, Dec 1 : The equity markets witnessed anet inflow of Rs 5,400 core from overseas investors duringNovember, taking their total investment in the country so farthis year to over Rs 73,100 crore, the highest ever inflow ina single year.

In November, foreign institutional investors (FIIs)bought shares worth Rs 51,063.10 crore, and sold equitiesworth Rs 45,565.90 crore, resulting in a net investment of Rs 5,497 crore, according to the data available with the marketregulator Securities and Exchange Board (SEBI).

The record inflow by FIIs into the local stock marketshas alarmed the government and other authorities concerned. It has also made industry chambers like Assocham demanding a two-percentage point tax on FII funds, while exporters body FIEO demanded government intervention to contain the flow asit had been making the rupee stronger against the Americangreenback, rendering exports incompetent from price angle.

After turning negative following the collapse of the globalfinancial services icon Lehman Brothers in the middle ofSeptember last year, FIIs inflow into the domestic stockmarkets have begun to rise sharply.

Last month, Finance Minster Pranab Mukherjee had said thatinvestment into the equity markets by foreign investors wasnot a matter of concern, but the government would act if itfinds any distortions.

Describing the foreign capital inflows as the successstory of India's recovery, Reserve Bank Deputy Governor SubirGokarn on Monday said that the inflow should not be viewed asa threat at this point of time.

"You could see them as a positive sign which is that theyreflect increasing global confidence in Indian recovery," the newly appointed Gokarn had said.

The trend of strong FII inflows to the tune of Rs 31,000crore witnessed during the June quarter gained furthermomentum during the July-September period, which attracted a net Rs Rs 34,313 crore.

Last year, FIIs were net sellers of the domestic stocksworth Rs 52,900 crore. The selling trend of FIIs continuedtill the first two months of the current year. However, by theend of March they started betting big on the domestic bourses.

So far this year, the Bombay Stock Exchange's benchmarkindex Sensex--composed of 30 blue-chip stocks--has risen over 70 per cent.