India's benchmark stock index raced to a new record high as foreign investors bought shares on hopes that a new pro-business government would emerge from elections next month.

The Bombay Stock Exchange's (BSE) benchmark index gained 1.06 percent to touch a lifetime high of 22,040.72 points in Tuesday morning's trading.

"Foreign institutional investors are buying, expecting the new government post-elections to be a stable and reform focused one," an equity analyst told AFP news agency on condition of anonymity.

The momentum in markets could last until April with election results in May providing the next set of cues, the analyst said.

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India's Hindu nationalist Bharatiya Janata Party, seen by business as better able to get the economy back on track, is tipped to win the elections due in April-May, defeating the ruling Congress party.

Growth slackened last year to a decade low of 4.5 percent and the government expects 4.9 percent expansion in this fiscal year to March 31.

Foreign institutional investors have purchased $7.4 billion in local equities and debt so far in the fourth quarter of the current fiscal year, data showed.

Source: AFP