After three months of fund infusion, foreign investors turned net sellers with withdrawal of ₹5,524 crore so far in July, due to ongoing trade tensions between the US and India and mixed corporate results.
With this, the total outflow has reached ₹83,245 crore so far in 2025, data with the depositories showed.
Looking ahead, the trajectory of FPI flows will hinge on developments in the US-India trade negotiations and corporate earnings, Himanshu Srivastava, Associate Director – Manager Research, Morningstar Investment Research India, said.
A resolution of the trade disputes and earnings recovery could potentially restore investor confidence and attract FPIs back to Indian markets, he added.
Going by the depositories data, Foreign Portfolio Investors (FPIs) withdrew a net sum of ₹5,524 crore from equities this month (till July 18).
This came following a net investment of ₹14,590 crore in June, ₹19,860 crore in May and ₹4,223 crore in April. Prior to this, FPIs had pulled out ₹3,973 crore in March, ₹34,574 crore in February, and a substantial ₹78,027 crore in January.
FPIs exhibited a notable shift in sentiment this month, reversing their previous bullish stance. This behaviour can be attributed to a combination of factors.
“While elevated market valuations prompted FPIs to reassess the attractiveness of Indian equities, ongoing trade tensions, especially between the US and India, and concerns over US interest rate policies contributed to a cautious investment outlook. Additionally, mixed corporate earnings raised doubts about the sustainability of corporate profitability,” Srivastava said.
Vaqarjaved Khan, Senior Fundamental Analyst, Angel One, also said that global markets and macro developments along with the result season in India led to the outflow.
On the other hand, FPIs invested ₹1,850 crore in the debt general limit and ₹1,050 crore in the debt voluntary retention route during the period under review.
Published on July 20, 2025
