Net FDI turned negative again in May 2026 with outflows exceeding inflows by $74 million

Net foreign direct investment inflows turned negative once again in May 2026, with outflows exceeding inflows by $74 million, according to the latest Reserve Bank of India data. This snapped a three-month streak of positive net inflows and was driven by a sharp drop in direct investment entering India.

That is, even though outflows fell, inflows fell by a larger amount.  

According to the data released as part of the RBI’s monthly bulletin for June 2026, the total amount of direct investment entering the country, or gross inflows, stood at about $6.1 billion in May 2026. This was 60% lower than in April, and nearly 23% lower than in May last year. 

The RBI’s commentary did not speak about May 2026 on a standalone basis, but instead focused on the April-May 2026 period.

During this period, it said that Japan, Singapore, and Mauritius accounted for around 74% of the total equity inflows, with financial services receiving the highest share, followed by manufacturing, retail and wholesale trade, and computer services. It added that these sectors together accounted for around 80% of total inflows. 

Total outflows stood at $6.1 billion in May 2026, lower than in April and in May of last year. Nevertheless, total outflows exceeded total inflows by $74 million. 

Within the outflows, outward investment by Indian companies stood at $2.4 billion in May this year, 49% lower than in April and 9.6% lower than in May 2025.

“Of the outward FDI, around 74% of the flows were directed towards the U.S., Cayman Islands, and the Netherlands; the major sectors included financial, insurance & business services, and manufacturing, accounting for more than 85% of the outward flows during April-May 2026,” the RBI said.

The other component of outflows, repatriation and disinvestment by foreign companies operating in India, stood at $3.7 billion in May 2026. This was 5.1% lower than in April and 13.3% lower than in May of last year.