India recorded a net foreign direct investment (FDI) outflow for the second consecutive month in October, as foreign investor repatriations and overseas investments by Indian companies together exceeded USD 8 bn, according to Reserve Bank of India (RBI) data (pdf).

Corridor angle: The UAE, Singapore, and the US accounted for more than half of India’s outward FDI in October, with around 90% of outbound investments concentrated in financial, ins., and business services.

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Gross FDI inflows during the month stood at USD 6.54 bn but were outweighed by outflows, resulting in a net FDI outflow of USD 1.55 bn. This follows a USD 1.66 bn net outflow in September.

Outbound momentum: Over the first seven months of FY 2025-2026 (ending in March), combined foreign investor repatriations and overseas investments by Indian companies totalled USD 52.13 bn, up from USD 47.26 bn in the same period a year earlier. Despite intermittent monthly outflows toward the latter part of the year, India recorded net FDI inflows of USD 6.2 bn in 7M of FY 2026.

Why it matters

These outflows are driven by higher interest rates and localization trends in developed countries, V. Anantha Nageswaran, chief economic advisor to the Modi government, told Indian Express. Indian entities are increasingly investing overseas to maintain a physical presence, “because in order to sell into those markets, you have to be present there these days rather than being able to export there,” he told the daily. These outflows are also adding pressure to the plummeting INR.

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