Foreign Portfolio Investors (FPIs) continued to pare their exposure to Indian equities in December, withdrawing Rs 17,955 crore in the first two weeks of the month. With this, total FPI outflows from equities in 2025 have mounted to nearly Rs 1.6 lakh crore, reflecting sustained pressure on domestic markets.

The latest sell-off follows a net withdrawal of Rs 3,765 crore in November, extending a trend of foreign selling that has largely defined the second half of the year. After a brief respite in October—when FPIs invested Rs 14,610 crore, ending a three-month streak of outflows—foreign investors resumed heavy selling. FPIs had offloaded equities worth Rs 23,885 crore in September, Rs 34,990 crore in August, and Rs 17,700 crore in July.

Data from the National Securities Depository Ltd (NSDL) shows that FPIs were net sellers to the tune of Rs 17,955 crore between December 1 and 12.

Market experts attributed the continued pullout to multiple factors, including elevated US interest rates, tight global liquidity, a depreciating rupee, and relatively rich Indian equity valuations. Analysts also cited global portfolio rebalancing, year-end effects, and lingering macroeconomic uncertainty.

However, the impact of foreign selling has been cushioned by robust domestic institutional investor (DII) participation, with DIIs investing Rs 39,965 crore during the same period.

Looking ahead, experts expect selling pressure to moderate, supported by India’s strong growth and earnings outlook. In the debt segment, FPIs withdrew Rs 310 crore under the general limit but invested Rs 151 crore via the voluntary retention route.