By YOUNG MONEY Staff
20 September 2010

For foreign funds, India may be this year's hottest ticket.

Non-Indian funds have poured a net $15.8 billion into Indian stocks this year, data from securities firm Nomura shows. Last week alone, foreign institutional investors parked $1.7 billion in Indian stocks - and according to the Securities and Exchange Board of India, the trend is continuing this week. On September 20, foreign inflows totaled $373.25 million.

What's driving investors' interest in the world's largest democracy? The country's growth story is alluring, for one thing: India's economy grew by 8.8 percent in the second quarter, making it the world's third-fastest-growing. Only China and Brazil outpaced it.

Also notable is India's sheer size. It has well over a billion residents, and many are eager to acquire the trappings of Western society. Many companies are capitalizing on the trend by offering inexpensive, Western-style products; Tata Motors, for example, sells a minicar called the Nano for roughly $2,500.

India is expected to continue urbanizing, so its growth may accelerate as its billion-plus citizens become more acquisitive. For young investors, Indian stocks are certainly worth investigating - and exchange-traded funds can make it easy to tap into the country's equity markets.