RBI raises short-term investment limit of FPIs to 30% from 20% of portfolio

FPIs will also be allowed to invest in exchange traded funds or ETFs that invest only in debt instruments, the RBI said.

With foreign investors dumping Indian debt but keeping up their investment in equities, the Reserve Bank of India (RBI) on Thursday increased the short-term investment limit of such investors. It doubled the limit in case they voluntarily disclose their investment plan before hand.

In two separate notifications, the central bank said foreign portfolio investors (FPIs) can now invest 30 per cent of their portfolios in central and state government securities, including in treasury bills, from the 20 per cent earlier.

Similarly, in corporate bonds, too, short-term investments can now be 30 per cent of the portfolio from 20 per