Mumbai: Foreign Portfolio Investors (FPIs) remained net sellers in the Indian stock market during May and withdrew Rs 27,048 crore from equities so far this month.
According to data from National Securities Depository Limited, total FPI outflows from Indian equities in 2026 have now crossed Rs 2.2 lakh crore.
This is already much higher than the total outflow of Rs 1.66 lakh crore recorded during the whole of 2025.
Selling Trend Continues in 2026
Foreign investors have remained cautious throughout the year due to global economic and geopolitical concerns.
FPIs had pulled out Rs 35,962 crore in January. However, February was the only positive month, when foreign investors invested Rs 22,615 crore into Indian equities. It was also the highest monthly inflow seen in the last 17 months.
The trend changed sharply in March, when FPIs withdrew a record Rs 1.17 lakh crore from the market.
The selling pressure continued in April with net outflows of Rs 60,847 crore and has now extended into May as well.
Global Concerns Affect Investor Confidence
Market experts said global uncertainty continues to impact investor sentiment toward emerging markets like India.
According to Himanshu Srivastava of Morningstar Investment Research India, rising geopolitical tensions, weak global growth concerns and fluctuations in crude oil prices are making investors more cautious.
He also said a strong US dollar and high US bond yields are attracting investors towards safer markets like the United States.
Pressure on Rupee Rising
Experts warned that continuous foreign selling is putting pressure on the Indian rupee.
Geojit Investments Chief Investment Strategist V K Vijayakumar said the rupee has weakened sharply this year.
At the beginning of 2026, the rupee was trading near 90 against the US dollar. By May 15, it had crossed the 96-mark and touched 96.14.
He added that high crude oil prices and continued FPI outflows may weaken the rupee further.
AI Investments Also Diverting Global Funds
Analysts also believe that global investors are currently shifting more money towards artificial intelligence-focused companies worldwide.
This has reduced investments in markets like India, which are currently seen as slower in the AI sector compared to some global markets.
