P/E ratio

FPI OUTFLOWS: CAUSES, CONSEQUENCES & POLICY RESPONSE

Foreign Portfolio Investors (FPIs) are key players in India’s capital markets, providing liquidity and linking the country to global finance. Recent data shows a massive FPI sell-off of ₹1.5 lakh crore in 2025, driven by tepid corporate earnings, high valuations, and global economic uncertainties. Such outflows impact market stability, exchange rates, and investment sentiment, highlighting the need for stronger corporate performance, policy reforms, and investor-friendly measures to restore confidence and attract sustainable foreign investment.