No ‘knee jerk’ reaction on P-notes, Jaitley assures market

Our Bureau New Delhi | Updated on January 24, 2018 Published on July 27, 2015

Finance Minister Arun Jaitley

SIT on black money suggested tough steps against PNs

Finance Minister Arun Jaitley assured the stock market that the there would be “no knee jerk” reaction by the government on the suggestions made by the Special Investigation Team (SIT) on black money.

“It is too early to say what view the government will take. But it will certainly not be a knee-jerk reaction, particularly one which has any adverse impact on the investment environment,” Jaitley told reporters here.

The SIT, in its third report made public last week, has suggested tough measures such as finding the ultimate beneficiary of Participatory Notes (PNs) and examining if a provision of allowing transfer of PNs is in any way beneficial in easing foreign investment.

A PN is a derivative instrument issued in foreign jurisdictions by a foreign institutional investor (FII)/sub-account or one of its associates against underlying Indian securities.

The court-appointed SIT has suggested measures to check inflows through PNs.

Commenting on the recommendations, Jaitley said: “The government will apply its mind in due course. A view will be taken keeping in mind the investment environment of the country as also the objective behind the SIT recommendations.”

Data show that at the end of June, the outstanding value of Offshore Derivative Instruments (ODIs) stood at ₹2.75 lakh crore after touching a seven-year high of ₹2.85 lakh crore in May.

Published on July 27, 2015
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