FII Investment in Government debt long term and corporate debt long term infra category
Summary
SEBI amends investment limits for Foreign Institutional Investors in government and corporate debt categories following RBI directives. The circular specifies enhanced caps, reduced lock-in periods, and adjusted residual maturity requirements for these investments. It further details the allocation mechanism via special auctions on the BSE with specific bidding constraints.
Text
The overall limit for FII investment in Government debt is enhanced from USD 15 billion to USD 20 billion, with the sub-limit for securities having 5-year residual maturity increased to USD 10 billion and the residual maturity requirement reduced to 3 years.
The conditions for the USD 22 billion limit for FII investment in corporate debt long term infra category are modified, including a uniform one-year lock-in period and a minimum residual maturity of fifteen months at the time of first purchase.
An additional limit of USD 5 billion shall be auctioned through electronic bidding, subject to a maximum allocation of INR 2,850 crore per single entity and a minimum bid amount of INR 1 crore.
A limit of USD 7 billion shall be auctioned through electronic bidding, subject to a maximum allocation of INR 3,138 crore per single entity and a minimum bid amount of INR 1 crore.
Additional limits for FIIs in government debt long term and corporate debt long term infra categories shall be allocated through a special auction conducted on the BSE from 15:30 hrs to 17:30 hrs on Wednesday, July 04, 2012.
Source: SecMarx — FII Investment in Government debt long term and corporate debt long term infra category. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.