The Impact of Lok Sabha 2024 Election Results on NRI Finances

An overview of the Lok Sabha 2024 election results on NRIs and their money in India
min read
June 8, 2024

On June 4, 2024, India witnessed the official results from India’s Election Commission on Wednesday, stating that the NDA won 294 seats, more than the 272 seats needed to secure a majority but far fewer than had been expected. 

This sent shockwaves to not just the 141.72 crore residents of India but also 3.21 crore NRIs, OCIs, and PIOs across the world. As the world watched the largest democracy exercise its electoral process, the results have brought about a major upheaval in the Indian economy and substantial implications for non-resident Indians, both financially and politically. 

In this blog, we break down the Lok Sabha 2024 election results’ financial implications for NRIs across the globe. Let’s dig in! 

Pre-Election Market Sentiments

Leading up to the election results on June 4, 2024, there was a strong sense of optimism in the Indian markets. Exit polls predicted a landslide victory for the BJP-led National Democratic Alliance (NDA), leading to a bullish sentiment. In fact, when the markets closed on June 3, the Sensex surged by 3.55%, reaching an all-time high of 76,013.09 points, while the Nifty 50 gained 3.58%, closing at 23,329.30 points. This rally was driven by the confidence that the existing government would continue its economic reforms and growth trajectory. 

The Market Plunge on June 4

Contrary to the pre-election optimism, the actual results led to a dramatic downturn in the stock market. The Sensex was down 4,389.73 points, or 5.74 percent, at 72,079.05, and the Nifty was down 1,379.40 points, or 5.93 percent, at 21,884.50. This marked the worst crash on Dalal Street in four years—the biggest single-day fall as the NDA fell short of the anticipated' 400 paar' mark. 

This unexpected outcome sent shockwaves through the market, reflecting investor anxiety and uncertainty. Interestingly, Foreign Institutional Investors (FIIs) were particularly reactive, pulling out significant investments amounting to Rs 12,436 crore, while Domestic Institutional Investors (DIIs) sold shares worth Rs 3,319 crore. The massive withdrawal by FIIs underscores the global attention and high stakes associated with the Indian elections.

NRIs’ Reaction to The Market Fall

There were immediate reactions across NRI communities, with differing opinions on continuing to keep the capital as is to going ahead and moving out of the market for a short while. There were also those who suggested moving to fundamentally strong stocks which aren’t heavily dependent on either party winning or losing. 






Why are NRIs in a Fix? 

The immediate impact on NRIs revolves around the volatility and adjustments in their investment portfolios. The sharp drop in the Sensex and Nifty has affected equity investments, mutual funds, and other financial instruments held by NRIs. The fall was particularly severe in the small-cap and mid-cap segments, which many retail investors, including NRIs, are significantly exposed to. 

Despite the initial shock, market analysts predict a recovery driven by the long-term economic policies expected to continue under the new government. However, NRIs are advised to maintain a long-term perspective, focusing on the stability and growth potential of the Indian economy rather than short-term market fluctuations. 

NRIs and the Voting Process

A noteworthy observation to also address is the NRIs’ ‘ability to vote.’ About 118,000 NRIs registered to vote in the Lok Sabha 2024 elections, out of which 12,000 were eligible voters, predominantly from Kerala. The logistical challenges of traveling back to India to vote means many NRIs did not participate directly in the electoral process. 

However, the substantial market reactions after the results suggest that NRIs and other global investors were closely monitoring the election outcomes. The disparity between FIIs pulling out Rs 12,436 crore and DIIs selling Rs 3,319 crore on 4 June 2024 highlights how external perceptions and actions can have profound impacts on the Indian market​.  

Economic Policies and Market Reaction

The BJP government, known for its pro-business stance, had implemented several key economic reforms during its previous terms. And the anticipation of a continued BJP-led administration was expected to sustain this momentum. However, the market's reaction to the actual election results indicates a more complex scenario. Investors who had banked on a decisive victory were caught off-guard, leading to a sell-off. 

In fact, as of the latest update, SEBI has been approached by political leaders to study the impact of Exit polls on the stock market rally that took place on 3rd June 2024 - a day before the election results were announced. This underscores the sensitivity of financial markets to political outcomes and the need for NRIs to remain vigilant and adaptable.

Long-term Outlook

NRIs play a crucial role in India's economy through remittances, investments, and consumption. The uncertainty following the election results may influence their investment decisions. The government’s stance on policies affecting NRIs, such as taxation, property ownership, and ease of doing business, will be pivotal in shaping their confidence.

As the dust settles from the election results, NRIs should stay informed about policy changes and new economic measures introduced by the government. The emphasis on long-term goals and diversification remains critical. NRIs should consider consulting with financial advisors to navigate the volatile post-election landscape effectively. 


The 2024 Lok Sabha election results have undeniably created a whirlwind in the Indian financial markets, with significant implications for NRIs. The initial market crash, marked by the worst performance on Dalal Street in four years, highlighted investors' volatility and sensitivity to political developments. FIIs' substantial sell-off compared to DIIs' more measured approach reflects the global scrutiny of India's political landscape.

Rupali enjoys writing about everything related to money (in India and around the world). A MICA graduate in Communications, she has over seven years of experience in content creation and communication strategy for various user touchpoints, from CRM to UX for apps and websites, especially in fintech and healthcare. Outside of work, you'll find her binging on true crime documentaries or cooking up a storm.

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