In just one week, China-dedicated funds got stunning inflows of more than $13 billion, while India-dedicated funds received only $107 million, accounting for less than 1% of the China inflows, according to Cameron Brandt, Director of Research at EPFR Global.

"Even though flows into dedicated India funds this week were less than 1 percent of the flows we saw into dedicated China funds, they were still positive, which I would take as a very good sign," cited Brandt.

In an interview with CNBC-TV18, Brandt called the abrupt shift in flows to China "spectacular." He stated that China's equities market has been the principal beneficiary of fresh money in recent weeks, particularly in the last week, when China was "the only show in town" in terms of flow. According to Brandt, India-focused funds have had strong inflows for 70 to 75 straight weeks. "The money is still coming, even when a very alluring alternative is on offer,"he remarked.

There is rising interest in how long the "sell India, buy China" trend will persist. Brandt believes that Chinese leaders' focus on growing their equities markets indicates that interest for China may continue. "Chinese policymakers have made it very clear that they are paying attention to their equity market and they want to see it on the rise," highlighted Brandt.

"It isn't as much of a straightforward India-China rotation as it might first appear," Brandt said, implying that the shift to China hasn't come primarily at India's cost. As investors seek to adjust their portfolios in response to shifting market conditions, European liquidity funds have provided a significant portion of the funding.

To put the statistics into context, the average weekly inflow into India-focused funds last year was between $400 million and $500 million. This week's $107 million amount is a significant fall, but it nevertheless demonstrates continued interest in Indian shares. Brandt said that larger global emerging market (GEM) funds, which contain India allocations, received $700 million inflows this week, which is an improvement over the outflows seen earlier this year. "Within those GEM funds, India's allocation, while still not as high as China's, is at a record high," said the economist.

Brandt believes that, while China may continue to receive considerable inflows, India's attraction will remain strong. "India remains in quite a healthy position," she said.