With the returns on financial assets like US treasury bills extremely low, foreign capital is moving into emerging markets like India. Foreign investors are driving Indian stock markets to new highs. Foreign players poured a staggering net investment of $23.4 billion in India’s equity markets. Even domestic individual investors have joined the frenzy in hopes of faster-than-expected economic recovery and disbursement of the vaccine.

Meanwhile, according to the Indian government’s estimates, the economy is set to contract by 7.7% in this financial year. This will be the Indian economy’s worst performance in more than four decades. In fact, with two consecutive quarters of drops in GDP, India is currently in a technical recession.

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