Congress attacks Modi govt over market fall, FII outflows; flags middle-class tax burden

Congress on Monday criticised the Narendra Modi-led government over the recent fall in the Indian stock market and continued foreign investor outflows, alleging that the government’s policies were hurting the middle class.

“More than ₹4 lakh crore has left our country through FIIs [Foreign Institutional Investors]. And it remained continuously negative for nine months… Never before has this happened in our country to this extent. This is January 2026,” Congress leader Shaktisinh Gohil said, referring to monthly net FII figures.

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Indian equities have been under sustained pressure in recent weeks. The Sensex fell 1.52% to close at 72,771.72 on September 28, its lowest level in nearly six months, while the index closed at 72,480.29 on September 30. On October 1, foreign investors sold another ₹10,148 crore, taking their year-to-date selling to about $27.8 billion, according to provisional data.

Gohil also targeted the Centre over capital gains taxation on stock market investments, arguing that middle-class investors were being subjected to a higher tax burden. “Short-term capital gains are taxed at 20 per cent. And for long-term capital gains, which Congress had made zero, they made it 12.5 per cent,” Gohil said.

He contrasted this with the Congress-led UPA government’s decision to make long-term capital gains tax on equity investments zero, with securities transaction tax (STT) being levied instead. “The long-term capital gains tax on the money the middle class invested in the stock market was made zero. And because of that, the middle class got relief from taxation. Only STT, a one-time tax, was introduced. Then the BJP government came and doubled the tax,” he said.

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Showing an NDTV interview in which PM Modi had encouraged people to invest in the stock market, Gohil argued that people who trusted the PM and invested were instead suffering losses.

“Those who invested money in the stock market at that time, the Sensex was at 85,836. On September 29, 2026, it fell to 72,500. Suppose you had invested money. After two years, your income is zero,” Gohil alleged, adding, “When you buy shares, you have to pay tax; when you sell them, you have to pay tax — whether you make a profit or a loss, that tax is taken on top of it.”

Comparing the market performance under the Congress-led UPA government with that under the Modi government, Gohil claimed that the Sensex rose 398% during the 10 years of Manmohan Singh’s tenure as prime minister.

“Among the upcoming emerging economies, look at South Korea or developed countries such as the USA. South Korea, Taiwan, Greece, Poland — everywhere, the share markets are moving rapidly upwards. So why is this happening in our country?” he asked.

“The BJP government has completely ruined the country’s economy,” Gohil said, adding that the government should take responsibility for the sustained FII outflows, the weak rupee and the losses suffered by middle-class investors.