Worsening Canada-India diplomatic ties may take a toll on FPI flows


Illustration: Ajay Mohanty

Deteriorating ties between India and Canada may have a bearing on flows into the home capital markets. At current, Canada is the seventh largest nation for overseas portfolio investor (FPI) flows into India.

In keeping with the Nationwide Securities Depository Ltd (NSDL), the property underneath custody (AUC) of FPIs domiciled in Canada stood at practically Rs 1.8 trillion ($21 billion) on the finish of August.


Nearly 85 per cent of those investments are in listed fairness, whereas the remaining in debt and hybrid devices.


The Canada Pension Plan Funding Board (CPPIB), one of many world’s largest retirement funds, is among the many largest FPIs investing within the home market. CPPIB has massive publicity to home corporations, actual property funding trusts (REITs) and infrastructure initiatives.


Amongst its key India investments are a 2.68 per cent stake in Kotak Mahindra Financial institution, valued at over Rs 9,500 crore ($1.1 billion), and $205 million infusion into IndoSpace’s actual property fund. It additionally has investments in Byju’s.


CPPIB additionally holds stakes in new-age corporations Paytm, Delhivery and Nykaa.


After establishing an workplace in Mumbai in 2015, the Canadian pension physique has stepped up its funding in India.


Market gamers don’t rule out a slowdown in capital flows from Canada till the connection between the 2 nations improves.

Nevertheless, they dominated out large-scale redemptions from India.

First Revealed: Sep 19 2023 | 10:18 PM IST

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