Finance Minister Nirmala Sitharaman delivered a pointed assessment of global capital movement, asserting that international fund flows today are influenced by far more than traditional commercial considerations.
Reflecting on trends observed over the past few years, Sitharaman said at the NDTV Profit Conclave 2026 these patterns had “revealed something which was probably lying under the carpet,” suggesting that geopolitical and strategic motives increasingly shape investment decisions worldwide.
She noted that several economies, including India, have maintained strong and consistent performance, backed by macroeconomic indicators that should naturally attract higher levels of foreign capital. “Every such indicator which should draw funds towards it is on an uptick,” she said, adding that India's macroeconomic indicators have been at their “recent best” for four to five consecutive years. Despite this, she observed that fund inflows often fall short of expectations: “Sometimes I won't say it's a trickle, but sometimes it doesn't flow as much as you expect."
Sitharaman stressed that it is becoming difficult to ignore the evidence that global fund flows are now “as political as they are economic,” with strategic interests playing a significant role. Her remarks underscored concerns that global capital allocation is increasingly shaped by geopolitical alignments rather than purely economic merit.
While highlighting India's macroeconomic strength, the finance minister struck a note of realism on growth expectations. "Every macroeconomic indicator is at its recent best," she said, pointing to resilience in the economy despite global headwinds. However, she added that policymakers need to remain grounded. "We need to be realistic about growth numbers," Sitharaman said, flagging volatile global uncertainties and external challenges as key risks.
She noted that geopolitical tensions, shifting capital flows, and uneven global recovery could continue to weigh on trade and investment decisions, making caution essential even in a relatively strong domestic environment.
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