Foreign investors eyeing India to avoid West's economic doldrums

Mumbai, Oct 14(ANI): Economists and policy makers reckon that the economic doldrums in the United States, along with much of Europe and Japan, could benefit emerging nations like India.

According to the New York Times, with an economic growth rate of nearly nine percent and a stock market that is more open to foreign investors than China's, India has become a destination of choice for foreign financial investors.

In the first nine months of the year, foreigners invested 28.5 billion dollars in Indian stocks and bonds - more than twice what they invested in the comparable period of 2009, the Times said.

The Sensex index is up about 22 percent in the last 12 months, and 114 percent since the end of 2008, it added.

"The rest of the world is starved for growth and India is still producing relatively high real rates of G.D.P. growth," the newspaper quoted Manish Saini, an analyst and trader at New York-based Eastern Advisors, as saying.he experts said that the foreign investors are moving money to emerging markets in part to take advantage of the interest rates, it said.

The interest rate set by the Reserve Bank of India stands at six percent, compared to near-zero rates in the US and Japan, it added.

They explained that as the difference between rates grow, traders can make more money by borrowing cheaply in dollars and yen and investing that money in higher yielding stocks and bonds in developing economies.

"If you look at the Indian opportunity, most things are going in its favor. And there aren't too many real risks that we see around the corner," said Neeraj Swaroop, who heads Standard Chartered's operations in India and South Asia. (ANI)