evidence: 1.38 In an uncertain global economic and financial environment, India remains an attractive investment destination. During 2023-24, net inflows of foreign portfolio investments (FPI) to India, both debt and equity, recorded a sharp turnaround, reaching its second-highest level ever at US$ 44.6 billion (BoP basis). During the current fiscal year so far (up to June 12, 2024), FPI flows were negative at (-) US$ 3.9 billion. External commercial borrowings (ECB) flows (net of principal repayments and intercompany borrowings) turned positive in 2023-24 from net outflows in the previous year. Also, both rupee-denominated and foreign currency denominated non-resident deposit schemes recorded inflows throughout 2023-24. Foreign direct investment (FDI) flows moderated, partly due to a rise in repatriations from India (Table 1.1). [...] An analysis for the period January 2010 – March 2024 suggests that net FPI inflows to Indian equities have remained lower during months of high geopolitical uncertainty, as measured by the geopolitical risk (GPR) index (Caldara and Iacoviello, 2022) than during other months (Table 2). In fact, the distribution of FPI flows during high and low geopolitical risk periods exhibits a fat left tail, indicating a higher likelihood of outflows from Indian equity markets (Chart 1).