After the emerging market funds, the global funds are entering India. Three foreign funds registered with the Securities and Exchange Board of India on Friday, bringing the total number of new entries in this calendar year so far to 18.

Market sources said the global funds now coming in have a strong "top-down philosophy," implying that these funds look at the macro picture first and if that is good, look lower down for attractive industries to invest in and then further lower for companies with attractive valuations.

"The trend so far this year is that it is not so much the dedicated emerging market funds that are entering the country as the top-down global funds coming in," said the research head of an institutional brokerage.

Despite the volatile indices, the long term India story is attracting foreign funds. FIIs have invested a record Rs 5,555.30 crore (Rs 55.55 billion) in the current year so far. Even smaller hedge funds such as Fortress are also entering India though it has put in a mere $10 million here on an experimental basis.

FII activity has increased in 2004 with the number of FIIs registered with Sebi going up from 517 on December 31, 2003, to 535 today, according to data released by Sebi.

The research head of a leading domestic brokerage said, "With half of the world facing elections this year, the easy monetary policy should continue." Global money flows are likely to continue seeking "sustainable "growth and "strong currencies".