Foreign institutional investors (FIIs) are planning to invest more funds in debt products as the new government under Bharatiya Janata Party (BJP) is expected to be a stable and growth-oriented government, according to market participants.
FIIs were net-sellers in debt instruments in April but they invested more funds this month as hopes for a stable government became firm, after exit polls indicated BJP coming close to a simple majority in the Lok Sabha.
FIIs bought debt securities worth Rs 6,130 crore till May 15.
BJP led National Democratic Alliance attained 336 seats out of the 543 Lok Sabha seats.
The Congress, however, could win only 44 seats in the 2014 elections. Any party or formation needs 272 seats to form the government.
Markets are hopeful that the new regime will be capable of ushering in new economic reforms.
The multi-phase Lok Sabha elections were held in 28 states and seven union territories. The 36 days long voting process began on 7 April 2014 and concluded on 12 May. The results were declared on 16 May 2014 after which India got the new government.
The term of the current Lok Sabha expires on 1 June and the new House has to be constituted by 31 May.
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