Change in investment conditions / restrictions for FPI investments in Corporate Debt securities
Summary
This circular mandates that all future FPI investments in corporate debt securities must have a minimum residual maturity of three years. It explicitly prohibits Foreign Portfolio Investors from investing in liquid and money market mutual fund schemes. The regulations take effect immediately without imposing any lock-in period for existing or new holdings.
Text
All future investments within the USD 51 bn Corporate Debt limit category... shall be required to be made in corporate bonds with a minimum residual maturity of three years.
FPIs shall not be permitted to invest in liquid and money market mutual fund schemes.
There will, however, be no lock-in period and FPIs shall be free to sell the securities (including those that are presently held with less than three years residual maturity) to domestic investors.
Source: SecMarx — Change in investment conditions / restrictions for FPI investments in Corporate Debt securities. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.