INDIA: SEBI to sign MoUs encouraging India foreign investment

Monday October 15 2012

It is being reported that Sebi may soon sign bilateral MoUs with its counterparts in at least six countries the aim of attracting India foreign investors from a larger number countries to the Indian capital markets.

At the same time, Sebi will request the market regulators across various countries to allow the Indian market intermediaries operating in their jurisdictions to solicit business from interested Qualified Foreign Investors (QFIs).

Foreign investors are permitted to invest directly through QFI route in stocks, mutual funds and corporate bonds through demat accounts opened with Sebi-registered Depository Participants, after meeting KYC norms applicable in the Indian markets.

However, the absence of an MoU between Sebi and the respective regulators in seven other countries (Argentina, Republic of Korea, Turkey, Kuwait, Qatar, Ireland and Latvia) make the entities in those jurisdictions ineligible to put money as QFIs into the Indian capital markets. Sebi has decided to sign MoUs with six countries – Argentina, Turkey, Kuwait, Qatar, Ireland and Latvia, which will enable QFI investment from these markets.

This information will be updated as further details become available.