look news india
New Delhi: India's weighting in the MSCI (EM-Emerging Market) index will exceed 20 per cent for the first time after a recent review by global index provider MSCI. This will leave a gap of only 400 basis points between the weightings of China and India, the largest weighting in the index. India's weightage was 9.2 per cent at the start of 2021, less than a quarter of China's 38.7 per cent. The MSCI India index has risen 84 per cent since 2021, while the MSCI China index has fallen nearly 50 per cent.
India's market share in a major emerging market benchmark will now cross 20 per cent for the first time. Funds with assets over $500 billion are included in this index.
India's weightage in the MSCI EM Index exceeding 20 percent is a significant achievement. It reflects India's growing credibility and acceptance on the global stage. India's share was around 8 percent in 2017, which has now more than doubled. This reflects the country's commitment to promote progress and the international investor community.
In 2018, India's weightage was 8.2 per cent and the index included 78 indigenous companies, but now their number has increased to more than 150. The inclusion of more stocks in the MSCI indices will help increase foreign investment inflows, which will also improve liquidity.
MSCI indices announced major changes on August 12. 27 new stocks have been added to the MSCI Small Cap Index, while Rail Vikas Nigam and Vodafone Idea have been added to the Global Standard Index. It is estimated that these changes in the MSCI indices will result in passive fund flows of $2.7 billion to $3 billion from FIIs on a net basis.
The August 2024 changes to the MSCI index saw the addition of 27 new stocks to the small-cap index, including Bandhan Bank, Go Digit General Insurance, Proteon EGV Technologies, Paras Defence & Space, and Aditya Vision.
With these changes, the broking house's Alternative and Quantitative Research has shown Closed Bank Passive Fund Inflows of $26 million and Go Digit Passive Fund Inflows of $11 million.