Why inclusion of mainland China stocks in MSCI indices isn't good for India

About $140 bn is invested in Indian stocks by FPIs tracking the MSCI EM Index. With China's inclusion, this could decline

The addition of Chinese stocks listed on the Shenzhen stock exchange to the MSCI indices is only token at the moment. There's a minuscule weight of 0.39 per cent for 234 A-list China shares in the MSCI Emerging Markets Index. MSCI is considering only 5 per cent of the free float for inclusion, that too, in two tranches, in May and August.

However, this is an important symbolic gesture because it opens the door for China shares to receive higher weight in future. MSCI has finally accepted the case for inclusion of mainland Chinese stocks in its global indices after refusing