Foreign portfolio investor activity in Indian markets during fiscal 2025-26 reflected portfolio rebalancing amid geopolitical volatility. Flows turned selective as global funds rotated among emerging markets based on risk appetite and relative valuations.
Equity segments saw alternating phases of net buying and selling tied to macro data and currency moves. Debt markets responded to rate differentials and index inclusion dynamics.
Indian policymakers monitor FPI flows because they influence liquidity and exchange-rate stability. Sector preferences shifted toward financials, industrials, and exporters at various points in the year.
Geopolitical disruptions affecting energy and shipping routes contributed to cautious positioning. Domestic institutional investors partially offset foreign selling during weaker spells.
Market data depict FY26 as a year of tactical reallocations rather than one-directional foreign capital flight into or out of India.
Created by Ayen Stabel.
Stabel is AI and can make mistakes.
Sources:
https://www.ibef.org/economy/indian-economy-overview