RBI revises limits on FPIs’ debt investment

The Reserve Bank on Friday upped debt investment limits for foreign portfolio investors (FPIs) across all segments, which will cumulatively result in an increase of more than ₹1 lakh crore in fiscal year 2018-19.

The total debt limit will rise to ₹5,94,600 crore by September 2018 and go up further to ₹6,49,900 crore by the end of the fiscal year from the present ₹5,45,823 crore, a central bank notification said.

RBI has decided to increase the FPI investment limits in central government securities by 0.5% to 5.5% of outstanding stock of securities in 2018-19 and 6% of outstanding stock of securities in 2019-20, it said.

The limits on FPI investment in state development loans (SDLs) would remain unchanged at 2% of outstanding stock of securities, it said. On corporate bonds, the FPI investment will be fixed at 9% of outstanding stock of corporate bonds and all the sub categories within the segment will be discontinued.

In the government securities general category, the limit has been revised up to ₹2,07,300 crore by September 2018 and ₹2,23,300 crore by March 2019 from the present ₹1,91,300 crore, it quantified.