Why FIIs Fled India in FY 2025-26

 Foreign investors (FIIs) withdrew heavily from India in FY 2025–26, with a record sell-off in March 2026. The main reasons were rupee weakness, high valuations, global risks, and a shift toward US AI stocks. Despite this, domestic investors helped support the market. The situation created short-term volatility but did not change the long-term outlook. Investors should stay consistent and avoid panic.

Short-term SIP returns can look poor due to market volatility and early-stage compounding, but this is normal; staying invested through downturns allows investors to benefit from rupee cost averaging and long-term market growth, while stopping early can reduce future gains.