Forbes India
Capital flow swings: India's total investment inflows have swung dramatically over a decade, peaking at $23.6 billion in August 2020 during a post-pandemic surge. Recent months tell a different story as March 2026 recorded a sharp $11.8 billion outflow, signalling growing investor caution amid global uncertainty. Hot money retreats: After a strong run through late 2023 and mid-2024, FPIs pulled out a record $13.1 billion in March 2026, the steepest single-month withdrawal in a decade, reflecting global risk-off sentiment and domestic valuation concerns. Capital fades: Net FDI into India has steadily lost momentum. After touching $18.2 billion in August 2020, monthly flows have trended lower, with several recent months turning negative. March 2026 recorded a modest $1.6 billion from $4.4 billion in the previous month. India invests abroad: Indian companies are increasingly exporting capital. FDI outflows, which barely crossed $1 billion monthly for most of the 2010s, have shifted upward, consistently hitting $2–4 billion monthly since 2024. The September 2025 peak at $4.7 billion signals India's growing ambition as a global investor. Sea change in sectors: India's FDI sectoral mix has shifted markedly since 2019. Banking and insurance have strengthened their lead, while sea transport has surged from near-zero to 15.5 percent. Meanwhile, computer software's share has nearly halved, and trading has fallen sharply. Singapore dominates: Singapore remains India's top FDI source, commanding a striking 45 percent share in December 2025, up from 34 percent in 2015-16. Japan has also gained ground, while Mauritius, once a dominant source, has seen its share nearly halve. FDI routes: In March 2026, India's gross FDI inflows totalled roughly $6.2 billion, with equity leading at $3.6 billion and reinvested earnings contributing $2.3 billion. On the other side, outflows and repatriations reached $3.7 billion.
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