India’s Net FDI Turns Negative for Second Consecutive Month in September
Net Foreign Direct Investment (FDI) in India (inflows minus outflows) presented an adverse picture in September 2025, turning negative at -$2.37 billion. This follows a negative net FDI of -$622 million in August, marking the second consecutive month of net outflows, according to RBI data.
H1FY26 Performance: Overall Robust Growth
Despite the recent monthly trend, the overall performance for the first half of the fiscal year (H1FY26) showed substantial growth compared to the previous year, driven by a rise in money brought into the country and moderated repatriation.
Net FDI: More than doubled to $7.64 billion in H1FY26, up from $3.4 billion in H1FY25.
Gross Inflows: Increased by 16.14% year-on-year (Y-o-Y) to $50.36 billion in H1FY26.
Repatriation: Declined marginally to $26.4 billion in H1FY26 from $27.79 billion a year ago.
The September 2025 Breakdown: Outward FDI Vaults Up
The negative net FDI in September was primarily driven by a sharp rise in outward FDI (investments made by Indian firms abroad), rather than a major drop in gross inflows.
| Component | September 2025 | September 2024 | Change Driver |
| Gross Inward FDI | $6.60 billion | $6.33 billion | Robust |
| Outward FDI | $3.78 billion | $2.3 billion | Vaulted Up |
| Repatriation/Disinvestment | $5.19 billion | $5.2 billion | Flat |
| Net FDI (Inflows – Outflows) | -$2.37 billion | -$1.17 billion | Became more negative |
Key Investment Flows and Destinations
Inward FDI (To India)
Top Source Countries: Singapore, Mauritius, the UAE, Luxembourg, and Qatar accounted for about 78% of total inflows.
Major Recipient Sectors: Manufacturing, retail & wholesale trade, communication services, financial services, and computer services.
Outward FDI (From India)
Key Destinations: Singapore, Mauritius, the UAE, and the US.
Major Sectors: Financial services, insurance & business services, agriculture & mining, and manufacturing.
The trend of two consecutive negative months indicates that Indian companies’ overseas investments and the repatriation of past earnings have recently outpaced the fresh FDI flowing into the country.
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