Why FIIs Are Dumping India: Valuations, Earnings & The Budget Signal, Raamdeo Agrawal Explains

Why are foreign investors pulling money out of India even as Budget 2026 signals openness and incentives? In this sharp post-Budget conversation, market veteran Raamdeo Agrawal explains why FIIs are driven less by sentiment and more by cold numbers. With multiple emerging market options available, foreign investors compare valuations, earnings growth and risk before allocating capital. India, he argues, has turned into a funding market - where money is sold and redeployed elsewhere. The real challenge lies in bridging the valuation gap or delivering rapid earnings growth of 15–20%. Until that happens, FIIs may continue selling. The turning point, he says, won’t be guessed - it will only be seen in the data when foreign money decisively returns.