Foreign Portfolio Investors Withdraw ₹60,847 Crore in April, Total Outflows Reach ₹1.92 Lakh Crore in Early 2026.

Foreign Portfolio Investors (FPIs) have continued their aggressive sell-off in Indian equities, withdrawing Rs 60,847 crore (USD 6.5 billion) in April. This trend is primarily attributed to escalating geopolitical tensions and global macroeconomic uncertainties which have significantly dampened risk appetite among investors. This latest pullback has pushed total FPI outflows to an alarming Rs 1.92 lakh crore in the first four months of 2026, surpassing the total Rs 1.66 lakh crore outflow recorded throughout 2025. Notably, FPIs have maintained their status as net sellers for all months thus far in 2026, exhibiting a pronounced trend of withdrawal except for a brief inversion in February, which saw an inflow of Rs 22,615 crore—marking the highest monthly influx in 17 months.

Analysts have pointed to a combination of global macroeconomic challenges and heightened geopolitical risks as major factors influencing these outflows. In light of escalating tensions in the Middle East, crude oil prices have surged, reigniting fears of global inflation. According to Himanshu Srivastava, Principal Manager Research at Morningstar Investment Research India, this environment has led to diminished hopes for near-term rate cuts and has kept global bond yields elevated, driving investor sentiment away from emerging markets such as India. Additionally, Vaqar Javed Khan from Angel One referred to April’s sell-off as a “textbook risk-off reaction,” indicating a cautious market response to the heightened risk landscape.

While the current situation appears precarious, there are signs of potential stabilization if certain conditions are met. Khan suggested that if a ceasefire holds in Iran and West Texas Intermediate (WTI) crude prices drop below USD 90 per barrel, FPIs might consider selective inflows, bolstered by strong domestic institutional investor (DII) buying, which has reached approximately Rs 1.7 lakh crore year-to-date. Furthermore, an anticipated earnings growth of 16% CAGR for the Nifty index through FY26 and FY28 could provide some attractiveness to investors. However, significant risks remain, including ongoing geopolitical tensions and fluctuations in US bond yields, which can trigger renewed selling pressure, warranting close observation in the coming months.

Source: The Economic Times

(Expert Note: This report was prepared by the Wealthova team.)