"NRI investors quit real estate sector as it was not paying off. Now, the gears have shifted to mutual funds," says Puneet Oberoi, a Delhi-based Certified Financial Planner.
According to Oberoi, NRIs don't consider investing directly in stocks as safe so take the mutual fund route which is a comparatively safer option, although funds too are subject to market risks.
According to AMFI data Indian mutual fund industry which has been growing at a rapid pace lately, manages a record 18 trillion rupees. Besides, lower interest rates being offered by bank's has also encouraged people to invest in mutual funds.
"Moreever, another reason for increasing investments from NRIs in mutual funds is the political stability in the country. The Modi government which is in a majority at the Centre has been giving positive vibes to foreign investors. On the contrary, the instability that has crept into the Unites States after President Donald Trump's travel ban has also worked in India's favour.
Chauhan said, "NRIs from USA and UAE are now in constant fear of having to leave the respective countries anytime. This is also a factor that they are looking towards India for investments."
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