India's Net FDI negative for fifth consecutive month due to increased repatriation.
India's Net Foreign Direct Investment (FDI) remained negative for the fifth consecutive month in January 2026, with outflows exceeding inflows by nearly $1.4 billion. This was primarily due to a significant increase in repatriation and disinvestment by foreign companies, which nearly doubled to $4.9 billion compared to the previous year. While gross FDI inflows remained strong from April 2025 to January 2026, manufacturing received the highest share of equity inflows, followed by computer services, electricity, and financial services. The Reserve Bank of India (RBI) noted that portfolio investments also flowed out more than they flowed in during March. The trend highlights the impact of foreign companies withdrawing capital despite continued gross inflows.
Key Points
- India experienced negative Net FDI for the fifth consecutive month in January 2026.
- Outflows exceeded inflows by nearly $1.4 billion, primarily driven by increased repatriation by foreign companies.
- Gross FDI inflows remained strong, with manufacturing, computer services, and energy sectors receiving the most equity.
- Repatriation and disinvestment by foreign companies nearly doubled in January 2026 compared to the previous year.
- Portfolio investments also showed net outflows in March, indicating broader capital withdrawal trends.
Exam Facts
- Net FDI in January 2026: -$1.4 billion.
- Repatriation and disinvestment increase: 97.3% (to $4.9 billion).
- Top sectors for equity inflows: Manufacturing, Computer Services, Electricity & Other Energy, Financial Services.
- Source of data: Reserve Bank of India (RBI) monthly bulletin.
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