The Reserve Bank of India (RBI) has issued updated guidelines for foreign portfolio investors (FPIs) regarding investment in corporate debt securities through the General Route. The policy removes the requirement for FPIs to comply with the short-term investment limit and concentration limits currently prescribed in the Foreign Exchange Management Debt Instruments Regulations, 2019. This decision aims to enhance investment ease for FPIs, thereby facilitating a smoother investment process. The updated Master Direction accompanies this circular effective immediately.
AD Category I banks are instructed to disseminate these directions among their constituents. The RBI guidelines outlined in this circular have been issued under section 104 and section 111 of the Foreign Exchange Management Act, 1999, without prejudice to requirements for permissions or approvals under any other law.
Key Entities Referenced
RESERVE BANK OF INDIA: The central bank of India, the issuer of the notification.
RBI20252635: Reference number for the communication from the Reserve Bank of India.
FMRD.FMD.No.0114.01.006202526: Another reference number associated with the Financial Markets Regulation Department (FMRD).
May 08, 2025: Date of the notification.
All Authorised Persons: Addressees of the notification.
MadamSir: Salutation used in the notification.
Foreign Portfolio Investors: The entity making investments in Corporate Debt Securities
General Route: The method by which investments are made
Authorised Dealer CategoryI AD CategoryI banks: Specific type of banks addressed in the notification.
Foreign Exchange Management Debt Instruments Regulations, 2019: Regulations pertaining to debt instruments, issued under the Foreign Exchange Management Act.
Notification No. FEMA. 3962019RB: Notification number related to Foreign Exchange Management Act.
October 17, 2019: Date of Notification No. FEMA. 3962019RB
Master Direction Reserve Bank of India Nonresident Investment in Debt Instruments Directions, 2025: A set of directions issued by the Reserve Bank of India concerning nonresident investment in debt instruments.
January 07, 2025: Date of the Master Direction
Master Direction: Abbreviated name for the document 'Master Direction Reserve Bank of India Nonresident Investment in Debt Instruments Directions, 2025'
FPIs: Abbreviation for Foreign Portfolio Investors
General Route: Route for FPI investments in corporate debt securities
paragraphs 4.4iii: Paragraph number in the Master Direction related to short-term investment limit.
paragraphs 4.4v: Paragraph number in the Master Direction related to concentration limit.
Financial Markets Regulation Department: Department within the Reserve Bank of India responsible for the notification.
Central Office Building: Location of the Financial Markets Regulation Department
9th Floor: Floor number in the Central Office Building
Shahid Bhagat Singh Marg: Name of the road where the Central Office Building is located.
Fort: Area in Mumbai where the Central Office Building is located.
Mumbai 400001: City and postal code of the Central Office Building.
India: Country where the Central Office Building is located.
9122 2260 1000: Telephone number of the Financial Markets Regulation Department.
cgmfmrdrbi.org.in: Email address of the Financial Markets Regulation Department.
Foreign Exchange Management Act, 1999: Act under which the directions are issued.
42 of 1999: Year and number of the Foreign Exchange Management Act.
Dimple Bhandia: Name of the Chief General Manager at Reserve Bank of India.
Chief General Manager: Designation of Dimple Bhandia
भारतीय � रज़वर् बैंक
RESERVE BANK OF INDIA
www.rbi.org.in
RBI/2025-26/35
FMRD.FMD.No.01/14.01.006/2025-26 May 08, 2025
To,
All Authorised Persons
Madam/Sir,
Investments by Foreign Portfolio Investors in Corporate Debt Securities
through the General Route – Relaxations
Attention of Authorised Dealer Category-I (AD Category-I) banks is invited to the
Foreign Exchange Management (Debt Instruments) Regulations, 2019 notified vide
Notification No. FEMA. 396/2019-RB dated October 17, 2019, as amended from time
to time; and the Master Direction - Reserve Bank of India (Non-resident Investment in
Debt Instruments) Directions, 2025 dated January 07, 2025 [hereinafter, ‘Master
Direction’].
2. At present, investments by Foreign Portfolio Investors (FPIs) in corporate debt
securities through the General Route are subject to the short-term investment limit and
the concentration limit as prescribed in paragraphs 4.4(iii) and 4.4(v) of the Master
Direction, respectively. On a review, and with a view to providing greater ease of
investment to FPIs, it has been decided to withdraw the requirement for investments
by FPIs in corporate debt securities to comply with the short-term investment limit and
the concentration limit.
3. The directions in this circular are issued with immediate effect.
4. The updated Master Direction is enclosed herewith.
5. AD Category-I banks may bring the contents of these directions to the notice of their
constituents.
�वत्तीय बाज़ार �व�नयमन �वभाग,केंद्र�य कायालर् य भवन, नौवीं मिंजल, शह�द भगत �सहं माग,र् फोटर्, मुंबई–400001.भारत
फोन: (91-22) 2260 1000, ई-मेल: cgmfmrd@rbi.org.in
Financial Markets Regulation Department, Central Office Building, 9th Floor, Shahid Bhagat Singh Marg, Fort, Mumbai – 400001. India
Tel: (91-22) 2260 1000, e-mail- cgmfmrd@rbi.org.in
िह�ी आसान है, इसका प्रयोग बढ़ाइए6. 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) without prejudice
to permissions/approval, if any, required under any other law.
Yours faithfully
(Dimple Bhandia)
Chief General Manager