Even as Foreign Institutional Investors (FIIs) have been selling across markets and pulling out money, their outflow was highest from India in 2011, compared with BRIC peers (Brazil, Russia, India and China) and other emerging markets.

According to data compiled by EPFR Global, FIIs withdrew over $4 billion from India in 2011, against an inflow of $1.35 billion in 2010. EPFR Global tracks foreign fund flows across markets and different asset classes.

Emerging European countries and China are other markets where FII outflows during 2011 were significant at $3.7 billion, followed by Brazil that saw $2.35-billion being pulled out.

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Foreign equity funds have been withdrawing from these markets consequently since last seven weeks as, "Headwinds from Europe, uncertainty about China's prospects next year and stubbornly high levels of inflation in many countries kept investors on edge. The latest redemptions were blunted by the reinvestment of dividends from some major Global Emerging Markets (GEM) Equity Funds, but 2011 ended with both Latin America and EMEA (Europe, Middle East and Africa) Equity Funds setting new outflow records," said Cameron Brandt, Global Markets Analyst with EPFR Global.

While gravity of outflows from India was high, according to him, the year also saw a general souring towards theme-driven fund groups. Dedicated BRIC Equity Funds posted outflows in 48 of the year's 52 weeks and flows into Frontier Markets Funds (like funds for investing in markets like Vietnam, Argentina etc) tailed off.

The latest theme, the so-called CIVETS (Colombia, Indonesia, Vietnam, Egypt, Thailand and South Africa) markets, also lost momentum."

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While EPFR Global data are widely accepted, they are at wide variance with the data provided by the Securities and Exchange Board of India (Sebi).

According to the Sebi data, FIIs' were net sellers in the Indian capital market, including the primary market, by $4.95 billion, against $4 billion as per EPFR. Data shown on exchanges say FIIs were net sellers in 2011 at $5.5 billion.

According to Sanjeev Prasad of Kotak Institutional Equities, its study of data on FII and overseas exchange-traded funds' investment in India doesn't reconcile with the reported data.

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He also said that EPFR Global data also doesn't show all source of foreign institutional investments that can invest in India like sovereign funds or private equity funds. Prasad says, "FII investment data discrepancy is another mystery like the data showing surge in exports."

These discrepancies in data is also because specific data of FIIs actual inflows and outflows are not maintained. According to an official with a custodian of foreign bank, exchange data are buy-and-sell figures gathered on a daily basis where FIIs may be bringing actual inflows and taking money and invest.

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They may also be taking money out of the country or reinvesting profits made from their earlier investments.

"As a custodian, they don't maintain records of inflows and outflows outside the country. They only track their client-FII investments and provide custodian related services," he said.

BRIC nations: Taking a beating

India saw the highest FII outflows among emerging economies. 

	Flows ($ million)
Brazil	1,561	2,340
Russia	3,468	-433
India	1,352	-4,088
China	4,008	-3,748
Greater China	1,411	-1,599
Africa Regional	1,297	-476
Emerging Europe	-60	-3,742
West Asia and Africa	318	-442
India figures: According to Sebi	29,320.72	-495.46
India figures: According to exchanges	13,788.34	-5,546.02
Converted as per $ rate for the day
Source: EPFR global