Foreign Investors DisclosureMarket regulator SEBI has taken a big step to increase foreign investment in India. The doors have been opened more for foreign investors in government security than before. The process for foreign investors to invest in Government of India bonds has been made so easy that for investments up to Rs 50 thousand crore, no more details will be considered than foreign portfolio investors. They will not be asked who their investors are nor will they be asked to provide details about them. Earlier this limit was only up to Rs 25 thousand.
Only general information will be sought from FPI
While investing in government securities, SEBI will seek only that much information from foreign portfolio investors as is required by the Reserve Bank and the Central Board of Direct Taxes. The objective of this initiative of SEBI is to increase the turnover of the securities market and bring transparency in the market. To achieve this objective, the process of investment in government securities by foreign portfolio investors has been made very easy.
This is applicable only for Government of India bonds
Speaking at an event, Sebi’s whole time member Ananth Narayan said that foreign portfolio investors will not be asked which of their investors are investing with special protection or why they are holding more of a particular type of security. But this will be only for Government of India bonds. The rules for private bonds will remain applicable as before.
Consultation paper released on Friday
A consultation paper was released by SEBI on Friday. In this, many types of proposals have also been made to increase the daily market volume by increasing the investment limit. This proposal is part of a circular of SEBI dated August 2023. Under this, many regulation related obstacles in investing in government securities have to be removed.
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