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March Madness: FPIs Dump Indian Assets in Record Exit
4 Apr
Summary
- FPIs recorded outflows of ₹24.74 trillion in a short trading week.
- March saw the largest ever monthly FPI equity sell-off totaling ₹1.17 trillion.
- Domestic investors' substantial buying cushioned the market impact.
Foreign Portfolio Investors (FPIs) recorded substantial net outflows from Indian markets in the truncated trading week ending April 3, 2026, with total outflows reaching ₹24,743.74 crore. This period saw only three trading sessions due to public holidays.
Equities bore the brunt of this sell-off, experiencing net outflows of ₹23,801.94 crore. The debt segment showed mixed flows, with some segments seeing outflows and others modest inflows. The Indian rupee was trading at ₹94.6543 against the US dollar on April 2.
March 2026 marked a historic monthly sell-off for FPIs, with total net outflows amounting to ₹1,25,736.40 crore. The equity segment alone saw outflows of ₹1,17,774.65 crore, the largest ever monthly equity sell-off by foreign investors in India.
Global factors such as ongoing conflict, rising crude oil prices above $100, a depreciating rupee, and a strengthening dollar have fueled this sustained selling. Elevated US bond yields also made fixed-income assets more attractive, prompting investors to rebalance portfolios.
Despite these significant outflows, domestic institutional investors have provided a crucial stabilizing force. They supported the markets with record buying, offsetting a large portion of the FPI selling.
The Reserve Bank of India intervened to support the rupee, implementing measures that led to a short-squeeze and an appreciation of the currency. However, fundamentally, the rupee is expected to remain weak as long as crude prices are elevated and geopolitical tensions persist.
