Overview
- Zerodha chief Nithin Kamath, who posted his takeaway Thursday, said foreign interest has "pretty much died out" and flagged worries about oil shocks, rich valuations, the weak rupee, and a lack of clear AI plays.
- FPI data show unprecedented selling, with about ₹1.14 lakh crore pulled from equities in March 2026 and more than ₹1.8 lakh crore leaving across FY 2025–26, followed by further outflows in early April.
- Investors cite geopolitical risk tied to West Asia and higher crude prices, which raise India’s import bill and pressure the rupee because the country buys most of its oil from abroad.
- Policy costs are a flashpoint, with the 2024 Budget lifting the long‑term capital gains tax on equities to 12.5% and a higher Securities Transaction Tax, which investors say makes each trade costlier.
- Funds that booked gains are rotating to Japan, Taiwan, South Korea, and parts of Europe, and market voices argue that trimming taxes and fees could help restore foreign liquidity and ease volatility for everyday investors.