India overtakes China in investment by US

Though India’s exposure within the emerging market basket has gradually declined, India has overtaken China in terms of direct equity allocation by US investors.

Flash points

• The report was revealed by US treasury showed that 1.8% of direct equity holdings of US is with India
• It is 6% equity holdings for China
• The direct investment has risen from $7 billion in September 2013 to $12 billion in December 2015.
• US investors’ direct investment in Chinese equities has declined from $12.8 billion to $11.1 billion.

Emerging Market allocation

• The allocation to India as emerging market has declined gradually
• The US investor’s equity allocation to emerging markets is down to 12%, which is lower than the peak of 18% in December 2009
• Peak allocation to emerging market for India by US in 2015-5.7%
• Peak allocation to emerging market for India by US in 2016- 3.7%
• It was compiled by Kotak Institutional equities