RBI's voluntary retention route sees muted response from foreign investors

The time frame for investment may have dissuaded funds wanting to invest, say experts

The Reserve Bank of India’s voluntary retention route (VRR) has seen a muted response from foreign portfolio investors (FPIs).

The RBI threw open the VRR to investors in March in a bid to attract long-term overseas money into the debt market while ensuring operational flexibility to FPIs to manage their investments.

Investments through the VRR are in addition to the general investment limit and are capped at Rs 40,000 crore for government securities and Rs 35,000 crore for corporate bonds per annum. The investment limits under the current tranche were open till April 30 or till the limits were exhausted,