New Delhi, Aug. 27 -- There is a shift in the investing landscape in the emerging markets, as India - once a foreign investor darling - is losing sheen as FIIs move to cheaper alternatives like Taiwan, South Korea, Brazil and China.

According to a recent Nomura report, Indian stocks have become the biggest underweight allocation for emerging market (EM) investors. In July, investors reallocated capital from India to markets like Taiwan, Hong Kong/China, and South Korea. As per Nomura's analysis of large EM funds, 71% of them were underweight on India at the end of July, up from 60% at the end of June, according to data cited in a Bloomberg report.

Nomura strategists, including Chetan Seth, noted that EM funds' relative allocation to Ind...