New Delhi, Aug. 18 -- India's capital account flows could rise sharply to around USD 120 billion in FY2027 from just USD 2 billion in FY2026, led largely by higher banking capital and external commercial borrowings, according to a Kotak Institutional Equities strategy report.

"We estimate capital account flows to jump sharply from US$2 bn in FY2026 to around US$120 bn in our base case in FY2027," the August 16 report said.

Kotak expects banking capital to account for the bulk of these flows, with USD 80 billion projected under this category, including USD 70 billion through Foreign Currency Non-Resident Bank, or FCNR(B), deposits. External commercial borrowings (ECBs) are estimated at USD 20 billion.

The increase would be "largely led ...