FPIs pull record ₹3 lakh crore from Indian equities in 9 months
Foreign portfolio investors have withdrawn more than ₹3 lakh crore from Indian equities in the first nine months of 2026, surpassing all previous annual outflow records with three months remaining in the year. According to NSDL data, FPIs have sold ₹3.05 lakh crore so far in 2026, compared with ₹2.4 lakh crore in 2025 and ₹1.21 lakh crore in 2024. This marks the first time outflows from the secondary market have crossed the ₹3 lakh crore mark. Including selling in government bonds under the Fully Accessible Route, FPIs have pulled out close to ₹3.58 lakh crore from both asset classes.
Rising US bond yields, a stronger dollar, and shifting expectations around global interest rates have reduced the attractiveness of emerging-market equities, according to analysts. Elevated crude oil prices could also weigh on India's import bill and corporate margins. The selling has kept markets under pressure, with the Sensex and Nifty down nearly 15.5% and 14% respectively in local currency terms, and more than 20% in dollar terms. FPIs have been sellers in six of the nine months, with reallocation to AI-centric markets like Taiwan and South Korea contributing to the outflows.
Meaningful recovery in FPI flows is not expected until there is greater clarity on global yields, interest rates, the US dollar, and crude oil prices. Government bond inflows had surged in June following government measures to attract foreign capital, but flows began tapering after Bloomberg deferred inclusion of Indian bonds in its Global Aggregate Index.
