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So far in 2025, foreign investors have withdrawn Rs 1.3 lakh crore from the stock market.
In August 2025, Foreign Portfolio Investors (FPI) withdrew about 35 thousand crore rupees (about 4 billion dollars i.e. Rs 34,993 crore) from the Indian stock market. This is the largest selling in the last six months. Earlier in February, FPI sold ₹ 34,574 crore.
Market analysts say that the reason for this is heavy tariffs imposed on Indian exports and high prices of shares in India. In July, FPI withdraws Rs 17,741 crore, that is, the selling of August was almost double that. According to depository data, in 2025, foreign investors have withdrawn Rs 1.3 lakh crore from the stock market so far.
FPI sellers remained on Friday
Foreign portfolio investors remained net sellers on the last trading day of the previous week i.e. Friday. According to NSE data, on August 29, FPI has sold shares worth Rs 8,312.66 crore. During the trading session, FII bought shares worth Rs 9,679.99 crore and sold shares worth Rs 17,992.65 crore.
At the same time, DII has bought shares worth Rs 11,487.64 crore. During the trading session, DIIS bought shares worth Rs 20,676.78 crore and sold shares worth Rs 9,189.14 crore.
Why is there so much selling?
According to Himanshu Srivastava, Associate Director, Morningstar Investment, ‘The US put up a 50% tariff on Indian exports, which stagged the trust of investors. This raises questions about India’s business competition and possibilities of economic growth.
Himanshu further stated that the corporate earnings of some major sectors in the June quarter were lower than expectations, which made investors’ enthusiasm and cooled.
At the same time, Chief Investment Strategist V.K. Vijaykumar says that the prices of shares in India are much higher than other markets. Because of this, foreign investors are taking their money to cheap markets.
Investment continues in primary market
However, FPI continued purchasing at the Primary Market (IPO) despite selling in the stock market. So far this year, he has invested Rs 40,305 crore through the IPO, because he seems to have prices there. At the same time, FPI invested Rs 6,766 crore in the Date General Limit in August, but withdraws Rs 872 crore from the debt volunte retention route.
Impact and future on market
The Nifty 50 and BSE Sensex declined by 1.4% and 1.7% in August due to US tariffs and high prices. The price of the rupee also reached a record low, which went below 88 per dollar. However, retail investors handled the market through domestic institutional investors (DII) and mutual funds.
DII purchased Rs 7060 crore in August. Experts believe that if talks about the trade deal between Indo-America were positive, then this selling could be temporary. India’s strong economic growth (6.5% GDP growth) and domestic demand may attract investors in a long time.
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