FM Sitharaman Says Fund Inflows Likely After PM’s Call with US President

FM Sitharaman Says Fund Inflows Likely After PM’s Call with US President

Positive Signals from India–US Engagement

New Delhi, Feb 6, 2026 — Finance Minister Nirmala Sitharaman on Friday expressed optimism about fresh capital inflows into India, stating that the recent telephonic conversation between Prime Minister Narendra Modi and the US President has sent encouraging signals to global investors. She indicated that strong diplomatic engagement between the two nations often boosts investor confidence and can translate into increased financial flows toward emerging markets like India.

Investor Sentiment Gets a Confidence Boost

According to the finance minister, high-level political communication plays a crucial role in shaping global investment sentiment. She noted that when two major economies demonstrate policy alignment and cooperation, international funds tend to view it as a sign of economic stability. This, she said, creates favourable conditions for both foreign direct investment (FDI) and foreign portfolio investment (FPI) into Indian markets.

Markets Reflect Growing Optimism

Financial markets have already begun reflecting this positive outlook. Recent sessions saw improved performance in Indian equities along with supportive currency movement. Analysts believe that diplomatic clarity, combined with India’s strong macroeconomic fundamentals, has helped reduce investor uncertainty. The expectation of stable trade ties and smoother economic cooperation with the United States has further strengthened market confidence.

Policy Reforms Add to Investment Appeal

Sitharaman highlighted that the government’s recent policy initiatives — including tariff rationalisation, export incentives, and supply-chain reforms — are designed to make India a more attractive global investment destination. She emphasised that these structural reforms, alongside geopolitical engagement, create a powerful combination that can draw sustained foreign capital into infrastructure, manufacturing, and technology sectors.

Focus on Long-Term Capital, Not Just Short-Term Gains

While welcoming potential inflows, the finance minister underscored the importance of channeling foreign funds into productive sectors. She reiterated that India’s priority is not merely short-term market liquidity but long-term investments that generate employment, innovation, and industrial growth. Maintaining fiscal discipline and macroeconomic stability, she said, remains central to the government’s economic strategy.

Government to Continue Global Outreach

Sitharaman concluded by affirming that India will continue engaging with global partners to strengthen investment pipelines. She encouraged international investors to look at India’s growth story, reform momentum, and policy consistency as key drivers for future opportunities. With diplomatic ties strengthening and reforms underway, policymakers remain hopeful that the coming months will see a steady rise in foreign fund inflows.