India FPI Outflows Amid Western Asia Conflict

Foreign portfolio investors (FPIs) continued heavy selling in India's equity markets, with weekly outflows of Rs 23,801 crore and a record Rs 1,17,775 crore in March. This sustained selling is primarily driven by the ongoing conflict in Western Asia, which has created global uncertainties and elevated geopolitical risks. The surge in Petroleum prices, particularly above USD 100 per barrel, has increased concerns over inflation and India's import bill, further pressuring the India===Indian Rupee. The India===Indian Rupee has depreciated by approximately 4 percent since the Western Asia conflict began, and fears of further depreciation are accelerating FPI outflows. Market experts, including V. K. Vijayakumar of Geojit Financial Services, note that while the selling has made Indian market valuations more reasonable, significant FPI inflows are unlikely until there is a de-escalation of the Western Asia conflict and a decline in Petroleum prices.