Capital inflow to stay strong for India despite US rate hike: Edelweiss

KOLKATA: Capital inflows to India will stay strong even if US rates were hiked, financial services major Edelweiss said today.

"Capital inflow worth $ 50-60 billion a year to India seems achievable both as FDI and FIIs," Edelweiss wealth management head Anshu Kapoor said here amid fears of a rate hike in the US.

Markets lost ground yesterday and today on fears that the Federal Reserves may hike rates in their next meet resulting to capital outflow. US Fed was likely to meet on March 17-18.

"Nothing wrong regarding interest rate in the US going up. Do not read much into it as inflow to India will remain strong in the long term," Kapoor said.

The optimism comes from global favourable terms shifting to India and the government policies paving way for a nine per cent growth over the next decade, according to the finance major.

Edelweiss head research Vinay Khattar said the Indian GDP was expected to reach $ five trillion by 2025.

He said oil prices were expected to stay soft with the shale gas boom and the OPEC cartel seems to be breaking with a slowdown in China.

Both analysts said the budget announcements and the recent government steps make them believe that the growth trajectory with a low inflation was around the corner.

West Bengal should take some credible action to give a clearer and easily understandable message to investors in boosting the capital inflow into the state, Kapoor said without elaborating further.