Foreign portfolio investors have pulled roughly ₹2.2 lakh crore (about $30 billion) out of Indian stocks in 2026 by early June. That makes it the worst year for foreign outflows since 1993, when FPIs were first allowed into Indian equities
The year-by-year picture (net FPI equity flows, NSDL data)
2022 saw an outflow of about ₹1.21 lakh crore, the previous record, caused by US rate hikes. 2023 reversed with roughly ₹1.7 lakh crore of inflows when India was a global favourite. 2024 turned negative again, with one dataset citing around ₹1.29 lakh crore of secondary-market selling. 2025 saw about ₹1.66 lakh crore leave.
And 2026 has already blown past all of them, with March alone recording a record monthly exit of ₹1.17 lakh crore
A note on the numbers: totals differ slightly across reports depending on cut-off dates and whether IPO buying is counted. The direction and scale are consistent everywhere.
Why are they leaving?
Four reasons: The West Asia conflict pushed crude oil above $100, hurting India’s import bill. The US dollar is strong and US bonds pay well, so why take emerging market risk. The rupee’s slide directly eats foreign investors’ dollar returns. And global money is chasing the AI boom elsewhere: in just three weeks of April, FIIs sold over $1 billion in India while putting about $1 billion into South Korea and $1.5 billion into Taiwan.
Who is holding the market up?
Ordinary Indians. Steady monthly SIP inflows at record levels, plus heavy buying by mutual funds and insurers, have absorbed most of the foreign selling.
What is SIP money?
SIP stands for Systematic Investment Plan. It’s the middle-class Indian’s autopilot investing: a fixed amount, say ₹500 or ₹5,000, automatically deducted from your bank account every month and invested into a mutual fund, which then buys stocks. Think of it as a recurring deposit, except the money goes into the stock market instead of a bank FD. It can start as small as ₹250 a month.
“Domestic SIP money of ~₹32,000 crore a month” means: every single month, ordinary Indian households are collectively pumping roughly ₹31,000 to 32,000 crore of fresh money into the market through these auto-debits. Because it’s automatic, it keeps flowing whether markets rise or crash. That steady river of local money is what has been absorbing the foreign selling.
In May, domestic institutions bought ₹82,668 crore of stocks while FPIs sold ₹55,963 crore. Foreign ownership of Indian stocks has fallen to a 14-year low of 14.7%, and for the first time in over a decade, domestic institutions (18.9%) own more of the market than foreigners do.
The bottom line
The market fell 7 to 9% this year & the Indian household’s monthly auto-debit is now bigger than the foreign fund manager’s sell button.
Next in this series: gold’s record high, its crash, and why both stories are true.
Sources: NSDL, SEBI and AMFI data via market reports.
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