Foreign banks say global conditions will dictate capital’s return to India

At one outlet BFSI Insight Summit, senior executives from Standard Chartered Bank India, Mashreq Bank, Citi India, HSBC India and DBS Bank India affirmed that India’s fundamental investment appeal remains intact despite recent foreign portfolio outflows. They attributed the capital shift to global financial conditions, including US-India interest-rate gaps, currency depreciation and heightened AI investment abroad.

The bankers stressed that a stable external environment, more attractive equity valuations and robust foreign direct investment are essential for capital to flow back. Trade agreements with the United Kingdom and the European Union were cited as potential catalysts, with estimated corridors worth up to $250 billion. Executives also pointed to the need for roughly $200 billion of gross FDI each year to achieve the 2047 development goal, and highlighted ongoing financing of infrastructure, renewable energy and cross-border expansion projects.