FPIs Pull Out ₹52,704 Crore From Indian Equities In First Half Of March, West Asia Conflict And Rising Crude Prices Trigger Fresh Sell-Off
· Free Press Journal
New Delhi: Foreign investors have withdrawn ₹52,704 crore from Indian stock markets in the first two weeks of March as global tensions and economic concerns weighed on sentiment.
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According to data from depositories, Foreign Portfolio Investors (FPIs) sold equities worth about ₹52,704 crore (around USD 5.73 billion) in the cash market till March 13. They remained net sellers on every trading day during the month so far.
This marks a sharp reversal after strong inflows in February, when foreign investors had invested ₹22,615 crore in Indian equities. That was the highest monthly inflow in nearly 17 months.
FPIs Attract ₹21,000 Crore From Indian Equities In 4 Sessions Amid West Asia Crisis & Surging Crude PricesImpact of West Asia Conflict
Market experts say the fresh outflows are largely linked to rising geopolitical tensions in West Asia.
The ongoing conflict involving the United States, Israel and Iran has increased uncertainty in global markets.
Fears that the conflict could disrupt oil supply through the Strait of Hormuz pushed crude oil prices higher. As a result, Brent Crude prices moved above USD 100 per barrel, raising concerns about inflation and economic growth in oil-importing countries like India.
Weak Rupee and Global Factors Add Pressure
Apart from geopolitical tensions, other global factors have also affected investor sentiment.
The Indian rupee has weakened close to ₹92 against the US dollar, while US bond yields remain high, making global investors cautious.
FPIs Pump Rs 22,615 Crore Into Indian Equities In February, Highest Monthly Inflow In 17 Months After Heavy SellingAnalysts also said some investors booked profits after the strong inflows seen earlier in the year.
According to market experts, weaker returns from Indian markets compared to other global markets over the past 18 months have also reduced the interest of foreign investors.
Countries like South Korea, Taiwan and China are currently considered relatively cheaper markets with better earnings prospects.
Sector-Wise Selling and Buying
Sector-wise, the IT sector has seen the biggest outflows in 2025, with FPIs withdrawing around ₹74,700 crore. This is mainly due to slower revenue growth and weaker global tech spending.
The FMCG sector followed with about ₹36,800 crore in outflows as urban consumption slowed and profit margins remained under pressure.
There was also selling in power and healthcare stocks, with outflows of about ₹24,000–26,000 crore.
Foreign Investors Return After 3 Months Of Selling, FPIs Pump ₹8,100 Crore Into Indian Stocks In One WeekHowever, FPIs increased their investments in sectors such as telecom, oil and gas, metals and chemicals, indicating a shift towards commodity-linked and domestic value sectors.
Outlook for the Coming Weeks
Market experts say the outlook for the rest of March remains cautious.
FPI selling may slow if geopolitical tensions ease or if strong fourth-quarter earnings from banking and consumption sectors boost confidence.
However, any further rise in oil prices or global uncertainty could keep foreign investors on the sidelines.