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SEBI raises FPI investment limit

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The market regulator SEBI has raised the FPI (Foreign Portfolio Investors) investment limit in government securities to 1,40,000 crore from April,4. This will help in attracting more foreign inflow into the nation.

Flash points

  • SEBI has proposed the hike in two tranches one in April and the other in July
  • Besides the FPI limit in central government securities, it also allows increase in State Development Loans
  • It has also been decided that any unutilized limit within the government debt limit for SEBI raises FPI investment limitlong term FPIs, at the end of the half-year, shall be made available for investment as additional limit to all categories of FPIs for the subsequent half-year
  • This will come into effect from October1, 2016

Hikes in limits

  • FPI Investments in government securities will be raised to 140000 crores in April,4 and 1,44,000 crores in July
  • FPI limits in SDL’s will be increased from 7000 crores to 10,500 crores in April and 14000 crores in July
  • Long term FPI’s will be made 50000 crores in April and 56000 crores in July

Points to note

  • The FPI limits were increase from 1,24,432 crores to 1,29,900 crores in October,2015
  • It was again restructured to 1,35,400 crores in January, 2016

Key Points

  • SEBI Chairman- K Sinha
  • Headquarters– Mumbai