FPIs can invest up to $ 81b in Indian debt securities

NEW DELHI, May 4 (PTI): Foreign portfolio investors (FPIs), a newly-created class for overseas investors, will be able to invest up to $ 81 billion (close to Rs 4 trillion) in government and corporate debt securities in India.
This would include investments up to $ 30 billion in government debt and up to $ 51 billion in corporate debt securities under the new FPI regime, which would come into force from next month.
According to market regulator  Securities and Exchange Board of India (Sebi), government securities would need to have a residual maturity period of at least one year to be eligible for investments from this new class of investors that would eventually encompass existing categories like FIIs, sub accounts and QFIs.
FPIs would also be permitted to invest in unlisted non-convertible debentures or bonds issued by corporates in the infrastructure sector, Sebi said in a detailed note on its new FPI guidelines.
Besides, FPI can invest in privately placed bonds if it is listed within 15 days, Sebi said.
The investment limit of $ 30 billion for government securities would include up to $ 10 billion by Category-I FPIs such as sovereign wealth funds, multilateral agencies, endowment funds, insurance funds, pension funds and foreign central banks.
An investment of up to $ 20 billion in government debt securities would be allowed to all kinds of FPIs.
For corporate debt securities, the overall cap will be $ 51 billion, which would include $ 2 billion in commercial papers.