FPIs Withdraws ₹88,180 Crore in March; 2026 Outflows Cross ₹1 Trillion on West Asia Tensions

Foreign Portfolio Investors (FPIs) have withdrawn ₹88,180 crore (approximately $9.6 billion) from Indian equities so far in March 2026, according to NSDL data.  

The outflows mark a reversal from February, when FPIs had invested ₹22,615 crore, the highest monthly inflow in 17 months. With the latest withdrawals, total FPI outflows for the year have crossed ₹1 trillion. 

Continuous Selling Through the Month 

FPIs have remained net sellers on every trading session in March up to the 20th. This shows one of the most sustained periods of selling in recent months.  

Despite the scale of withdrawals, the outflow remains marginally lower than the record ₹94,017 crore seen in October 2024. 

The shift follows a brief recovery in February and indicates a quick change in investor positioning. 

Geopolitical Tensions and Oil Prices 

The selling trend coincides with escalating tensions in West Asia. Concerns over a prolonged conflict and potential disruption to supply routes through the Strait of Hormuz have pushed Brent crude prices above $100 per barrel. 

Higher crude prices have raised concerns about inflation, current account pressures and the impact on corporate earnings. These factors have contributed to a broader risk-off sentiment among global investors. 

Currency Weakness and Global Yields 

The rupee has weakened to around ₹93 against the US dollar, adding pressure on foreign investor returns. At the same time, rising US Treasury yields have increased the attractiveness of dollar-denominated assets. 

This has led to capital moving away from emerging markets, including India. The shift has also been accompanied by tighter global liquidity conditions. 

Sectoral Trends 

Financial services stocks have seen the highest selling pressure. FPIs sold shares worth ₹31,831 crore in the sector during the fortnight ended March 15. Market sentiment has also been influenced by expectations of margin pressure in the March quarter earnings. 

Read More: Airfare Caps Lifted: Govt Removes Temporary Limits, Impact Likely from April 1, 2026! 

Conclusion 

FPI activity in March shows the impact of geopolitical developments, currency movements and global interest rate trends. Further movement in flows is likely to track changes in these factors. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.   
 
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