RBI announces FPI investment limits in G-secs, SDLs
- IBEF
- June 1, 2021
On Monday, the RBI (Reserve Bank of India) announced that in FY22 the investment limits for FPI (foreign portfolio investors) investment in State Development Loans (SDLs) and government securities (G-secs) would persist unaffected at 2% and 6% respectively.
RBI in a notice announced that for FY22, the allocation of incremental changes in the G-sec limit (in absolute terms) will be retained at 50:50, over the two sub-categories 'General' and 'Long-term'.
As per the guidance on 'Investment by Foreign Portfolio Investors (FPI) in Government Securities: Medium Term Framework (MTF)', the 'General' sub-category of SDLs has recorded an addition of increase in limits for SDLs (in absolute terms).
As of March 31, 2021, the FPI limit stood at Rs. 9,54,280 crore (US$ 131.61 billion) in G-Sec General, G-Sec Long Term, SDL General, SDL Long Term, and Corporate Bonds.
For April 2021-September 2021, the revised limit (in absolute terms) stands at Rs. 10,14,957 crore (US$ 139.97 billion). This includes limit for G-sec General at Rs. 2,43,914 crore (US$ 33.64 billion) and Corporate Bonds at Rs. 5,74,263 crore (US$ 79.20 billion). For October 2021 – March 2022, the FPI investment limit in the debt instruments stands at Rs. 10,75,637 crore (US$ 148.34 billion).
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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