The Department of Economic Affairs (India finance ministry department) reported record foreign direct investment, while foreign portfolio investors pulled $23.6 billion from Indian markets after the Iran war began.
India attracted a record $94.5 billion in foreign direct investment in FY26, according to a Department of Economic Affairs (India finance ministry department) report. The same report said foreign portfolio investors withdrew $23.6 billion from Indian markets after the Iran war began. The figures point to a divergence between long-term capital commitments through foreign direct investment and more liquid market flows from portfolio investors, which can react faster to geopolitical risk.