Foreign investors have pulled out a total of ₹38,535 crore from Indian capital markets in the first two weeks of April, driven by heightened global market volatility and escalating concerns over the ongoing international tariff war.
According to data from depositories, Foreign Portfolio Investors (FPIs) offloaded ₹31,575 crore from the equity markets between April 1 and April 11. In the same period, FPIs also withdrew ₹6,960 crore from the debt markets, bringing the total net outflow to ₹38,535 crore.
Analysts cite global uncertainties, particularly those arising from trade tensions and protectionist policies, as key factors behind the outflows. The ongoing tariff dispute between major economies, including the US and China, has triggered a risk-off sentiment among international investors, prompting a shift away from emerging markets like India.
“The foreign sell-off is largely in response to global headwinds and increased risk aversion,” said Radhika Sharma, economist at Capital Insight. “Investors are pulling funds from riskier assets as they await more clarity on global economic direction.”
This marks a sharp contrast from March, when Indian markets saw healthy FPI inflows amid optimism around corporate earnings and domestic growth forecasts.
The withdrawals have added pressure on the Indian rupee, which has shown signs of depreciation, while benchmark indices such as the Sensex and Nifty 50 have experienced increased volatility in recent trading sessions.
Despite the current outflows, experts believe the pullback may be temporary. “India’s macro fundamentals remain strong, and once global conditions stabilize, we could see renewed interest from FPIs,” Sharma added.
Market participants and policymakers are expected to keep a close watch on geopolitical developments and central bank cues that could influence global liquidity and investment flows in the coming weeks.