Amid rising geopolitical tensions, concerns over the growth of the global economy and continued weakness in the rupee, foreign investors (FPIs) sold more than Rs 62,853 crore from the Indian stock market in the first fortnight of June. With this latest withdrawal, the total withdrawal of FPI from Indian stocks so far in 2026 has increased to Rs 2.87 lakh crore. This is more than the Rs 1.66 lakh crore withdrawn in the entire 2025. These figures have come from the data of National Securities Depository Limited (NSDL).
According to Pabitro Mukherjee, Deputy Vice President-Research, Bajaj Broking, FPI flow in the coming week will largely depend on the US-Iran peace talks, the interest rate decision of the US Federal Open Market Committee, the policy of the Central Bank of Japan and comments from other big central banks.
Sales have been done in every month except February
According to NSDL data, FPIs have been net sellers in every month of 2026 except February. In January he had withdrawn Rs 35,962 crore. After this, Rs 22,615 crore was invested in February, which was the largest monthly investment in the last 17 months. However, this trend completely reversed in March and foreign investors sold a record Rs 1.17 lakh crore. There was a withdrawal of Rs 60,847 crore in April and Rs 32,963 crore in May. Rs 62,853 crore has been withdrawn in the first two weeks of June alone.
According to Himanshu Srivastava, Principal Manager Research, Morningstar Investment Research India, investors are still operating in an environment where there is uncertainty regarding the direction of interest rates, geopolitical developments and global growth. He said that in such times, investors from emerging markets often withdraw money to reduce risk and turn towards developed markets or safer assets.
RBI has taken many steps
He said that this is a big positive for a big oil importing country like India. India’s balance of payments deficit is estimated to be around $60 billion in FY27. Since foreign investment plays a major role in supporting the current account and balance of payments, the government and RBI have taken several steps to attract foreign capital.
These include the RBI bearing the hedging cost on FCNR deposits raised by banks, expanding the forex swap window, increasing the facility of investment in government bonds through Fully Accessible Route (FAR) and increasing the investment limit in domestic stocks for NRI and OCI investors. On the other hand, despite withdrawal from equity, foreign investors invested more than Rs 13,200 crore in debt securities through the FAR route in the first fortnight of June. With this, the total investment through this route has reached around Rs 28,000 crore in 2026.
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