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India Sees 770 Million Dollar Outflows Amid Global Shift Toward AI Linked Investments
India recorded net outflows of $770 million in the latest week as global investors continued reallocating capital toward select artificial intelligence-linked opportunities. While broader AI and commodity trades are showing signs of slowing, investor appetite for core US technology and AI beneficiaries remains strong.
By Finblage Editorial Desk
11:30 am
15 June 2026
India witnessed net capital outflows of approximately $770 million during the latest reporting week as global investors continued repositioning portfolios toward artificial intelligence-focused investment themes. The trend comes amid a broader reshuffling of global capital flows, with investors favoring markets and sectors perceived to have direct exposure to the AI ecosystem.
According to Elara Capital's Global Liquidity Tracker, Global Emerging Market (GEM) funds have recorded six consecutive weeks of outflows totaling around $10 billion. Investors have also withdrawn money from precious metals and commodity-related funds, indicating that some of the most popular investment themes of the past year are beginning to lose momentum.
Despite the moderation in broader AI-related trades, investor conviction in core AI beneficiaries remains robust. US technology-focused funds attracted a record $9 billion in inflows during the recent market correction, while foreign investments into US equities remained positive for an eleventh consecutive week, reaching a five-month high.
The report noted that India and China continue to be among the markets experiencing sustained outflows as part of this global capital rotation. Of the total $770 million withdrawn from India, focused funds accounted for approximately $460 million. Redemptions from Japan-domiciled funds accelerated to a record $170 million, while Luxembourg-based funds also remained significant sellers.
At the same time, domestic investors in Taiwan and South Korea used recent market weakness to increase exposure, investing $5.3 billion and $3.7 billion respectively. These markets have been major beneficiaries of the global AI investment cycle due to their strong semiconductor and technology ecosystems.
The report also highlighted that US-domiciled funds have not been a major source of incremental selling in India over the past eight weeks, suggesting that recent outflows have largely originated from other investor groups. India's relative performance against global emerging market funds has fallen to record lows over one-year and three-year periods, levels that have historically coincided with major turning points in market performance.
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