FPI Investment in Govt Securities

[Ref: RBI/2017-18/108 -A.P. (DIR Series) Circular No. 14 dated 12 December 2017]

Sub: Investment by Foreign Portfolio Investors (FPI) in Government Securities Medium Term Framework Review

Attention of Authorised Dealer Category-I (AD Category-I) banks is invited to Schedule 5 to the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000 notified vide Notification No. FEMA.20/2000-RB dated May 3, 2000, as amended from time to time.

Revision of Limits for the next quarter Jan - Mar 2018

2. The limits for investment by FPIs for the quarter January March 2018 is increased by INR 64 billion in Central Government Securities (Central G-Secs) and INR 58 billion in State Development Loans (SDLs). The revised limits are allocated as per the modified framework prescribed in the RBI/2017-18/12 A.P.(Dir Series) Circular No.1 dated July 3, 2017, and given as under.

Limits for FPI investment in Government Securities

(Rs. Billion)

 

Central Government Securities

State Development Loans

Aggregate

 

General

Long Term

Total

General

Long Term

Total

Existing limits

1,897

603

2,500

300

93

393

2,893

Revised limits

1,913

651

2,564

315

136

451

3,015

3. The revised limits will be effective from January 01, 2018.

4. The operational guidelines relating to allocation and monitoring of limits will be issued by the Securities and Exchange Board of India (SEBI).