While global equity markets are swimming in record liquidity, India is witnessing a exodus of foreign capital. Market expert Sandip Sabharwal has flagged this contrast, pointing out a disconnect between domestic foreign portfolio investor (FPI) outflows and the broader global rally.

On the social media platform X, Sabharwal shared figures that paints a picture for domestic markets. "Interesting data highlighting how out of favour India currently is with global investors," he said.

Sabharwal highlighted that global equity funds have attracted over $210 billion in just the last six months, which is the strongest six-month stretch of inflows on record. 
 

The broader optimism extends to emerging markets as well, with Emerging Market (EM) exchange-traded funds (ETFs) raking in $35 billion so far in 2026, he noted

However, the Indian market has a completely different story. India has faced selling pressure, year-to-date in 2026, the domestic market has recorded FPI outflows amounting to $21 billion, Sabharwal said.

The market expert emphasised the rarity of this capital flight, stating, "I cannot recall seeing such a sharp divergence between flows into India and the broader EM basket."

He also wrote that the Ministry of Finance and the Prime Minister's Office “may need to closely evaluate the reasons behind this trend and consider corrective measures."