**Summary:**
This circular, A.P. DIR Series Circular No. 14, issued by the Reserve Bank of India (RBI) on December 12, 2017, announces revisions to the limits for Foreign Portfolio Investor (FPI) investment in Government Securities (G-Secs) for the quarter of January-March 2018. The investment limits are increased by INR 64 billion in Central Government Securities and INR 58 billion in State Development Loans (SDLs).
The revised limits, effective from January 1, 2018, are allocated according to the framework prescribed in A.P.Dir Series Circular No.1 dated July 3, 2017, as follows:
* **Central Government Securities:**
* General: Revised limit of INR 1,913 billion (Existing limit: INR 1,897 billion)
* Long Term: Revised limit of INR 651 billion (Existing limit: INR 603 billion)
* Total: Revised limit of INR 2,564 billion (Existing limit: INR 2,500 billion)
* **State Development Loans:**
* General: Revised limit of INR 315 billion (Existing limit: INR 300 billion)
* Long Term: Revised limit of INR 136 billion (Existing limit: INR 93 billion)
* Total: Revised limit of INR 451 billion (Existing limit: INR 393 billion)
* **Aggregate (Central Government Securities + State Development Loans):**
* Total: Revised limit of INR 3,015 billion (Existing limit: INR 2,893 billion)
The Securities and Exchange Board of India (SEBI) will issue operational guidelines regarding the allocation and monitoring of these limits.
Authorized Dealer (AD) Category-I banks are instructed to inform their constituents and customers about these revisions. The directions in this circular are issued under sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999.
For further information, contact the Financial Markets Regulation Department, Reserve Bank of India, Main Building, 1st Floor, Shahid Bhagat Singh Road, Fort, Mumbai – 400001. Tel: 91-22-22603000; Fax: 91-22-22702290; Email: cgmfmrdrbi.org.in. The circular was signed by T. Rabi Sankar, Chief General Manager, RBI.
Key Entities Referenced
Reserve Bank of India: The central bank of India, responsible for monetary policy and regulation of the banking system.
Foreign Portfolio Investors: Investors who invest in financial assets of a country without directly managing those assets.
Government Securities: Debt instruments issued by the government to finance its expenditures.
Foreign Exchange Management Act, 1999: An Act of the Parliament of India to consolidate and amend the law relating to foreign exchange with the objective of facilitating external trade and payments and for promoting the orderly development and maintenance of foreign exchange market in India.
Central Government Securities: Debt instruments issued by the central government.
State Development Loans: Debt instruments issued by state governments.
Securities and Exchange Board of India: The regulator of the securities market in India.
Mumbai, Maharashtra: Financial Markets Regulation Department is located in Mumbai.
भारतीय �रज़व र् बक�
RESERVE BANK OF INDIA
www.rbi.org.in
RBI/2017-18/108
A.P. (DIR Series) Circular No. 14 December 12, 2017
To,
All Authorized Persons
Madam / Sir
Investment by Foreign Portfolio Investors (FPI) in Government Securities
Medium Term Framework – Review
Attention of Authorised Dealer Category-I (AD Category-I) banks is invited to Schedule 5 to the
Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside
India) Regulations, 2000 notified vide Notification No. FEMA.20/2000-RB dated May 3, 2000, as
amended from time to time.
Revision of Limits for the next quarter Jan - Mar 2018
2. The limits for investment by FPIs for the quarter January – March 2018 is increased by INR 64
billion in Central Government Securities (Central G-Secs) and INR 58 billion in State
Development Loans (SDLs). The revised limits are allocated as per the modified framework
prescribed in the RBI/2017-18/12 A.P.(Dir Series) Circular No.1 dated July 3, 2017, and given as
under.
Limits for FPI investment in Government Securities (₹ Billion)
Central Government Securities State Development Loans Aggregate
General Long Term Total General Long Term Total
Existing limits 1,897 603 2,500 300 93 393 2,893
Revised limits 1,913 651 2,564 315 136 451 3,015
3. The revised limits will be effective from January 01, 2018.
4. The operational guidelines relating to allocation and monitoring of limits will be issued by the
Securities and Exchange Board of India (SEBI).
�वत्तीय बाज़ार �व�नयमन �वभाग, मुख्य भवन, पहल� मंिज़ल, शह�द भगत �सहं माग,र् फोटर्, मुंबई – 400001.
फोन: (91-22) 22603000, फैक्स: (91-22) 22702290 ई-मेल: cgmfmrd@rbi.org.in
Financial Markets Regulation Department, Main Building, 1st Floor, Shahid Bhagat Singh Road, Fort, Mumbai – 400001.
Tel: (91-22) 22603000, Fax: (91-22) 22702290 e-mail- cgmfmrd@rbi.org.in5. AD Category – I banks may bring the contents of this circular to the notice of their
constituents and customers concerned.
6. The directions contained in this circular have been issued under sections 10(4) and 11(1) of
the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to
permissions/approval, if any, required under any other law.
Yours faithfully
(T. Rabi Sankar)
Chief General Manager
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