Foreign Portfolio Investors (FPIs) have made a strong return to Indian equities, investing around ₹53,739 crore in November so far. Their renewed buying has helped the Nifty 50 record seven straight sessions of gains and reduce its 2026 losses to 4.15%. This comeback comes as global investors shift away from some AI-related stocks and take comfort from falling crude oil prices.
Market experts believe expectations of tax reforms are also improving investor sentiment. Industry groups have urged the government to provide relief on long term capital gains (LTCG) tax, simplify capital gains rules and rationalise the Securities Transaction Tax (STT). There is growing hope that Budget 2027 may introduce measures that make India more attractive for global investors.
Many foreign investors with large unrealised profits are reportedly delaying stake sales while waiting for clarity on possible tax changes. Discussions between policymakers, regulators and industry representatives have focused on reducing transaction costs and improving market liquidity.
Global factors are also supporting flows into emerging markets. Expectations of lower interest rates, better liquidity conditions and changes in US trade policies have strengthened confidence. While recent inflows have boosted market sentiment, experts say their sustainability will largely depend on actual tax reforms and the broader global investment environment.
