Foreign portfolio investors purchased only ₹3,546 crore in Indian government securities through the fully accessible route in FY26, a sharp decline from the previous year's ₹2.

Foreign portfolio investors purchased only ₹3,546 crore in Indian government securities through the fully accessible route in FY26, a sharp decline from the previous year's ₹2.31 lakh crore inflow driven by JP Morgan index inclusion. March saw the largest monthly outflow of ₹17,686 crore as the rupee weakened to record lows amid West Asia conflict escalation. Bond yields have surged 55 basis points while the rupee declined over 11% this fiscal year, making Indian assets significantly less attractive to global investors. Economists anticipate muted flows in FY27 due to ongoing geopolitical tensions, continued rupee weakness, and relatively superior US bond yields. Fiscal concerns following excise duty cuts on fuel have further dampened sentiment.