Morgan Stanley shifts p-note base as govt tightens rules for FPIs

India's largest p-note issuer moves from Singapore to France; changes to Indo-Mauritius tax treaty could have triggered shift

Morgan Stanley, India’s largest participatory notes (p-note) issuer, has shifted its operations from Singapore to France amid changes to the Indo-Mauritius tax treaty. According to sources, all the p-notes issued by the American brokerage starting from January 1, 2018 will be coming through France route instead of Singapore. However, the Morgan Stanley has not shut-down its Singapore operations as a substantial amount of p-notes it has issued from that jurisdiction are still active and transferring these instruments to a different location could trigger tax provisions of indirect transfers. 

This shift by Morgan Stanley comes even as the Indian government has