The relative outperformance of Taiwan and South Korea over last one year within the EM basket led by strong rally in AI related stocks has diverted a disproportionate share of global capital to these markets with their combined weight accounting for roughly 50% of MSCI EM Index. Indias’ weight in EM Index slipped to a six year low of 10.9%, nearly half the record level of 21% reached in 2024. Indian companies perceived as Dull brick and mortar businesses, have received no love from Foreign Portfolio Investors (FPIs) since September 2024 as they chased exciting AI plays in Korea and Taiwan (refer Graph 1 below).