Exciting news for India as it gears up to join J P Morgan’s GBI-EM index, a move that is expected to shift a whopping Rs 91,820 crore ($11 billion) from South Africa, Poland, and Thailand’s local markets. According to analysts at the Wall Street lender, India’s entry will result in significant fund movement, with Rs 39,232 crore ($4.7 billion) expected to flow from South Africa, Rs 27,546 crore ($3.3 billion) from Poland, and Rs 26,712 crore ($3.2 billion) from Thailand.
With India’s inclusion set to reshape the emerging market landscape, J P Morgan’s strategists anticipate a redistribution of investments within the region. The EMEA area is projected to witness a decline in aggregate weight, dropping to 26.2 per cent by March post India’s full inclusion in the index.
International investors have already shown strong interest in Indian government bonds, pouring in over Rs 83,475 crore ($10 billion) since the announcement of India’s inclusion. Despite the anticipated outflows from certain markets, countries like China, Indonesia, and Mexico are expected to maintain their index weights, signaling a dynamic shift in global market dynamics.
Stay tuned as India embarks on this transformative journey in the world of emerging market bonds!
Published 26 June 2024, 05:08 IST