Home / Business and Economy / FPIs Flee India: $2.29B Outflow Amid Mideast Conflict
FPIs Flee India: $2.29B Outflow Amid Mideast Conflict
7 Mar
Summary
- FPIs net sold ₹20,818.71 crore in Indian markets over four sessions.
- Middle East conflict cited as primary driver for sustained FPI selling.
- Nifty 50 and BSE Sensex saw significant percentage drops over the week.
Foreign portfolio investors (FPIs) withdrew a net of ₹20,818.71 crore ($2.29 billion) from Indian markets between March 2 and March 6, 2026. This outflow occurred over four trading sessions, with equity markets experiencing the most significant selling. On March 5 alone, FPIs divested ₹11,141.74 crore, primarily from equities.
The geopolitical tensions in the Middle East, particularly the conflict involving the United States, Israel, and Iran, have been identified as a major catalyst for these outflows. Concerns over potential disruptions to global oil supplies and a subsequent rise in crude oil prices, coupled with the rupee's depreciation, have contributed to FPIs' cautious stance.
Experts suggest that FPIs are unlikely to return as buyers until there is greater clarity on the conflict's outcome and a reduction in crude oil prices. The Indian market reflected this sentiment, with the Nifty 50 falling 2.89% and the BSE Sensex dropping 2.91% over the week.
Despite the substantial FPI selling, domestic institutional investors (DIIs) actively absorbed the pressure, investing ₹32,787 crore during the same week. Continued mutual fund SIP inflows also provided some support to the market.
