FPI Norms Eased for Corporate Debt: RBI Move
Why in the news
RBI loosened rules for foreign portfolio investors in corporate bonds to deepen the market and add liquidity.
Key facts
- Applies to the general route for government securities and corporate debt.
- Short-term investment limit: FPIs need no longer follow it.
- Concentration limit on one FPI’s exposure to a single corporate issuer: removed.
What changes
| Earlier curb | Now |
|---|---|
| Short-term investment cap | Not required |
| Single-issuer concentration limit | Withdrawn |
Significance
- Lighter rules may attract inflows.
- More trading and stability.
- Complements efforts to deepen capital markets.
Exam angle
- Regulator: RBI; investors: FPIs.