What is the roll of FII (Foreign Instituional Investor) in our stock market.?

As recent uptrend of the sensex & Nifty , it is said that these are due to FII ( Foreign Institunal investor) who have been buying the shares of the comapanies since mid-august 2007. My queries are what is the Rule Governs for investmentment by FII in our stock market. Why & how they are taking prominent position in our stock market. What is the Pro & Cons of these trend.Please clarify.