Foreign Portfolio Investors (FPIs) have continued to exit Indian equities, withdrawing a net ₹17,955 crore in the first two weeks of December. This brings total FPI outflows for the year 2025 to about ₹1.6 lakh crore, marking one of the most sustained sell-offs in recent times. Experts attribute this trend to factors such as rich Indian valuations compared to other emerging markets, tighter liquidity conditions globally, and investor preference for safer assets amid macroeconomic uncertainties.
These outflows have put pressure on Indian benchmark indices and could influence trading sentiment in early 2026. Domestic fund managers believe that without renewed foreign interest, markets may remain range-bound. However, some see this as an opportunity for long-term investors, noting that India’s economic growth fundamentals still support equity valuations over multi-year horizons.
