Money & Banking

RBI raises FPI investment limit in G-Secs

Our Bureau Mumbai | Updated on March 27, 2019 Published on March 27, 2019

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The Reserve Bank of India, on Wednesday, upped the investment limit for FY2019-20 for foreign portfolio investors (FPI) in Central government securities (G-Secs) to 6 per cent of outstanding stock of securities from 5.5 per cent in FY2018-19.

The limit for FPI investment in State development loans (SDLs) and corporate bonds has been left unchanged at 2 per cent and 9 per cent of outstanding stocks.

As against the current limit of ₹6,49,900 crore, the revised limit for FPI investment in debt for FY2020 has been set at ₹6,98,300 crore for the first half, and ₹7,46,500 crore for the second half of the financial year.

The allocation of increase in G-Sec limit over the two sub-categories – ‘general’ and ‘long-term’ – has been set at 50:50 for the year 2019-20. The entire increase in limits for SDLs has been added to the ‘general’ sub-category of SDLs. The RBI said the coupon reinvestment arrangement for G-Secs shall be extended to SDLs.

Published on March 27, 2019
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