Jul 29, 2025

RBI Relaxes Norms for FPIs Investing in Corporate Debt Securities through General Route

As per the Master Directions on Non-resident Investment in Debt Instruments dated January 7, 2025, the Foreign Portfolio Investors (‘FPIs’) investing in corporate debt securities were bound by:

i.    a short-term investment limit, wherein investments by FPIs in short term corporate debt securities, i.e., corporate debt securities with a residual maturity of up to one year, was restricted to a maximum of 30% of its total corporate debt investments; and

ii.   a concentration limit, wherein investments by FPIs in corporate debt securities was limited to 15% of the prevailing investment in case of long term FPIs and 10% of the prevailing limit in case of other FPIs.

With an aim to provide greater ease of investments to FPIs, the RBI has, by way of a Circular dated May 8, 2025, withdrawn the requirement for investments for FPIs in corporate debt securities to comply with the short-term investment limit and concentration limit.

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