New Delhi, 22 March (H.S.):

Foreign portfolio investors (FPIs) have remained net sellers in Indian equities through March 2026, driven by rising geopolitical tensions in West Asia. As of the third week of the month, overseas investors have offloaded stocks worth ₹88,180 crore (about 9.60 billion U.S. dollars), according to data from the National Securities Depository Limited (NSDL).

When the outflows for the first three weeks of March are added to earlier months, FPIs have pulled out more than ₹1,01,527 crore from the domestic stock market between January 2026 and the end of the third week of March 2026.

In contrast, foreign investors had bought ₹22,615 crore in February and sold ₹35,962 crore in January, highlighting the sharp shift toward risk‑off sentiment in the current period.

NSDL figures show that FPIs turned sellers on every trading session in March so far, building steady pressure on the market.

The good news for India, though, has been the robust buying by domestic institutional investors (DIIs), who have tried to cushion the fallout. In the first three weeks of March alone, DIIs have invested about ₹1,01,168.60 crore in equities, helping to limit deeper falls in the index despite the heavy foreign selling.

Market experts say the surge in FPI outflows is largely linked to the ongoing conflict in West Asia, which has spooked global investors and raised fears of disruptions to trade and energy supplies. The Strait of Hormuz route has seen disruptions, pushing crude oil prices above 100 U.S. dollars per barrel.

A sharp rise in the U.S. dollar index has also pushed the Indian rupee to record lows, while higher U.S. bond yields have made dollar‑denominated assets more attractive, prompting capital flight from emerging markets such as India.

Prashant Dhamee, Vice President at Dhamee Securities, points out that the West Asia crisis has dented global growth expectations and raised the prospect of higher oil‑driven inflation and slower economic expansion in India. This has led foreign investors to adopt a defensive stance and pull money out of riskier equities, including those in India, for the time being.

Until the geopolitical situation stabilises and crude‑price and currency pressures ease, analysts expect FPI flows into Indian markets to remain cautious and possibly volatile.

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Hindusthan Samachar / Jun Sarkar