Foreign Institutional Investors (FIIs) have been reallocating funds from India to China, influenced by several key factors:

1. China's Economic Stimulus Measures

China has recently implemented significant stimulus initiatives, including easing monetary policies and increasing government spending, aimed at revitalizing its economy. These measures have enhanced the appeal of Chinese markets, prompting FIIs to redirect investments from India to China.

2. Advancements in Artificial Intelligence (AI)

China's rapid progress in AI technologies, exemplified by breakthroughs like DeepSeek, has attracted global investor interest. The successful development and integration of AI models have positioned Chinese tech companies favorably, leading FIIs to capitalize on these opportunities.

3. Attractive Valuations in Chinese Markets

Following recent market corrections, Chinese stocks have become more attractively valued compared to their Indian counterparts. This valuation disparity has enticed FIIs seeking better returns, resulting in a shift of funds towards China.

4. Geopolitical and Trade Considerations

Evolving geopolitical dynamics and trade relations have influenced investment decisions. China's proactive engagement in global trade and investment initiatives has bolstered investor confidence, contributing to the reallocation of funds by FIIs.