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The Reserve Bank of India (RBI) has clarified that the restriction on investments with less than three years residual maturity shall not be applicable to investment by foreign portfolio investors (FPIs) in security receipts issued by asset reconstruction companies (ARCs).
However, investment in security receipts shall be within the overall limit prescribed for corporate debt from time to time, RBI said. Earlier, the regulator had received enquiries about the applicability of the aforesaid directions on investment by FPIs in the security receipts. RBI also said operational guidelines, if any, would be issued by the Securities and Exchange Board of India.
