Foreign investment flows into India turned positive in October 2025, signalling a rebound in investor sentiment after a month of net outflows. Net foreign investment inflows stood at $1.9bn during the month, compared with net outflows of $2.3bn in September, according to official data.
The recovery was led by portfolio investors, with foreign portfolio investment (FPI) registering net inflows of $3.4bn in October, reversing net outflows of $621m in the previous month. Foreign direct investment (FDI), however, continued to see net outflows, though at a slower pace of $1.5bn, down from $1.7bn in September. Overall, between April and October 2025, net foreign investment inflows totalled $5.5bn, driven largely by FDI inflows of $6.2bn, even as FPIs remained marginal net sellers.
Non-resident Indian (NRI) deposits also showed a sharp turnaround. Outstanding NRI deposits rose by 1.4% to $168.2bn in October, reflecting net inflows of $2.3bn, after a net outflow in September. Growth was seen across deposit categories, including NRE, NRO and FCNR(B) accounts, suggesting improving confidence among overseas Indians.
During the same period, the Reserve Bank of India stepped up foreign exchange market intervention, selling a net $11.9bn in October, compared with $7.9bn in the previous month. The central bank’s net forward sales also increased, pointing to continued efforts to manage currency volatility.
The RBI’s December bulletin underlined resilience in the broader economy, noting that real GDP growth accelerated to 8.2% in the September quarter, the fastest pace in six quarters. Growth was supported by strong private consumption and domestic demand, even as manufacturing activity showed signs of moderation.
Looking ahead, policymakers are seeking to improve economic measurement and sustain growth. The government plans to use real-time GST data to sharpen state-level growth estimates, while a report by EY India says public capital expenditure will remain the main anchor of medium-term growth, provided fiscal discipline is maintained.
