Finance Minister Nirmala Sitharaman has said the recent weakness in India's stock market is partly linked to the ease with which investors can sell their holdings, while asserting the economy's underlying fundamentals remain sound, IANS reported on Monday.
Speaking to CNBC on the sidelines of the IMF and World Bank annual meetings, she said because liquidity is easy to access, people are exiting easily. She said India's economic fundamentals remained sound, but sustained capital outflows could pose a significant challenge in 2027, and identified continued capital outflows as one of the biggest risks facing India.
Domestic equity benchmarks have declined nearly 12 per cent so far this year even as the economy continues to grow amid trade uncertainty and geopolitical tensions. Foreign portfolio investors have sold more than $33 billion worth of Indian equities so far this year (yaani over $33 billion — about Rs 2.9 lakh crore), according to data from depository NSDL.
In the previous session on October 16, FIIs turned net buyers after 15 straight sessions of selling and bought equities worth about Rs 1,166 crore, while DIIs ended their 45-session buying streak with net sales of around Rs 3,661 crore.
Sitharaman said India has not received the scale of AI-linked investments flowing to the US, Taiwan and South Korea, which means it has less exposure if the global AI boom reverses, and that India is investing in semiconductor manufacturing and is no longer a laggard in advanced technology.
Benchmarks down nearly 12% this year • FPIs sold over $33 billion of Indian equities in 2026 (NSDL) • Oct 16: FIIs net buyers of about Rs 1,166 crore after 15 selling sessions • DIIs net sellers of about Rs 3,661 crore, ending a 45-session buying streak • Sitharaman flags sustained capital outflows as a key 2027 risk
Sources: IANS via New Kerala and The Freedom Press, NationPress and BTin (19 October 2026); remarks reported by CNBC.