Indian trade agreements with the US and EU drive foreign investment and support the rupee
Trade deals with the EU and US have strengthened foreign inflows and the rupee. The RBI noted that fiscal discipline and record spending will bolster growth.
The Reserve Bank of India stated in its monthly bulletin released today that India 
IN has seen a significant boost in foreign portfolio inflows and a strengthening of the rupee following the signing of a free trade agreement with the European Union and an interim trade deal with the United States 
US. The central bank noted that these international agreements, alongside government budget measures such as a lower fiscal deficit target and record capital expenditure, are expected to support private investment and enhance productive capacity.
IN has seen a significant boost in foreign portfolio inflows and a strengthening of the rupee following the signing of a free trade agreement with the European Union and an interim trade deal with the United States US. The central bank noted that these international agreements, alongside government budget measures such as a lower fiscal deficit target and record capital expenditure, are expected to support private investment and enhance productive capacity.According to the bulletin, this shift represents a notable reversal in market trends. Between April 2025 and February 3, 2026, foreign portfolio investors had recorded net outflows totaling $5.8 billion. However, the trend shifted in February, with the market seeing positive net flows and a subsequent recovery in the value of the rupee.
