Foreign institutional investors (FIIs) have significantly sold Indian stocks, with outflows totaling approximately ₹1.85 lakh crore from July to December 2025 and over ₹8,400 crore in January. This trend is attributed to weak corporate earnings, high valuations, and concerns over a delayed India-US trade deal, potentially exacerbated by US tariffs linked to the 'Sanctioning of Russia Act of 2025'. Despite these outflows, experts suggest strong Q3 earnings could attract FIIs back to the Indian market, contingent on the trade deal's progress.