India is emerging as a "parking lot" for global investors, but the capital flows in the market taking it to the 20,000-point mark "sometimes causes concerns" for the government, Commerce and Industry Minister Kamal Nath said on Tuesday.
"The Sensex yesterday moved to the 20,000 mark. Sometimes it concerns us," he said at the Fortune Global Forum in New Delhi.
However, Nath said strong fundamentals of the Indian economy would ensure flow of funds in the country.
"With the strong fundamentals and PE ratio, India is emerging as a major parking lot for investors," he said.
The country has seen foreign institutional investments surge to a record 17 billion dollars this year. In October alone, FIIs have pumped in nearly 8 billion dollars. The flows soared after the US Federal Reserve cut a key rate on September 18.
Speaking at the event, Finance Minister P Chidambaram also said the country needs to put in place appropriate regulations to manage the capital inflows.
"Today in India, we face a problem of enormous capital flows. This is a completely new situation for us. We welcome capital but we must learn how to manage capital, how to absorb capital," he said.
"We need to put in a place appropriate regulations, we have to put in place risk management systems," he added.