INDIA: SEBI Review of Debt Limit Allocation Mechanism for India FIIs

Monday October 8 2012

In the Board meeting of 6th October, regarding the review of the debt limit allocation mechanism for India FIIs, SEBI announced that:

(i) With effect from January 01, 2014, the FIIs shall be allowed to re-invest during the calendar year to the extent of 50% of their debt holdings at the end of the previous calendar year.

(ii) The utilization period for Government Debt and Corporate Debt limits will be reduced to 30 days and 60 days respectively.

(iii) In the FII Debt limit, the unutilised limit in respect of Corporate Debt infra long term bonds category may be availed by the FIIs/Sub Accounts without obtaining prior SEBI approval till the overall FII investments reaches 90% of the limit, after which the auction mechanism shall be initiated for allocation of remaining limits.

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