SEBI hiked FPI investment limit for govt debt

Releasing a circular, Indian market regulator SEBI hiked FPI investment limit for government securities from earlier Rs 1.85 lakh crore to new over Rs 1.91 lakh crore. The step has been taken in order to boost foreign funds inflows into the Indian market. The new FPI investment limit will be made effective from next month.

As per the department, the new FPI investment limit will be applicable from January 2018 to March 2018 quarter and will come into effect from January 1, 2017. Long-term FPIs (sovereign wealth funds multilateral agencies, insurance funds, pension funds and foreign central banks) in central government bonds will also be raised to Rs 65,100 crore from the current limit of Rs 60,300 crore.

Apart from increasing FPI investment limit, there will be a new limit for investment by all FPIs in state development loans (SDL) which will be Rs 31,500 crore, and that of long-term FPIs will be Rs 13,600 crore.

What is SEBI (Securities and Exchange Board of India)?

The Securities and Exchange Board of India (SEBI) is the government’s designated regulatory body for the finance and investment markets in India. The main function of SEBI department is to maintain stable and efficient financial and investment markets by creating and enforcing effective regulation in India’s financial marketplace. It is very similar to the U.S. Securities and Exchange Commission.

SEBI was established in the 1988 and was given statutory powers on 30 January 1992 through the SEBI Act, 1992. It is headquartered in Mumbai.

Current chairman of SEBI is Ajay Tyagi.

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