Updated Guidelines for Portfolio (FII) Investment by NRIs

Updated Guidelines for Investment by NRIs (Non Resident India) (Sept 2001)

Investment Division
F.No.14/11/96-NRI
Government of India
Ministry of Finance
Department of Economic Affairs
(Investment Division)
New Delhi, dated the 20th September, 2001 (Updated)

PRESS NOTE
Subject: Enhancement in the limits on investments by Foreign Institutional Investors (FIIs).

1. Foreign Institutional Investors registered with SEBI are permitted to invest subject to an aggregate investment limit of 24% of the issued and paid up capital of an Indian company. In terms of the RBI Notification No.41/2001-RB dated 02 March, 2001 and Press Note dated 08th March, 2001, the Indian companies were permitted to enhance the normal aggregate portfolio investment limit from 24% to 49% under specified special procedure.

2. It has since been decided to increase the portfolio investment ceiling applicable to Foreign Institutional Investors (FIIs). Pursuant to the above decision, Indian companies would henceforth be permitted to raise the aggregate ceiling for FII portfolio investments through the secondary market from the normal level of 24%, upto the applicable Sectoral Cap levels, of the issued and paid up capital of the company subject to compliance with the special procedure viz.:

a) Approval by the Board of Directors of the Company to the enhanced limit beyond 24%; and

b) A Special Resolution passed by the General Body of the Company approving the enhanced limit beyond 24%.

3. All other requirements governing FII portfolio investments would continue to be operative as before.

4. In terms of RBI Notification No. FEMA 45/2001-RB dated 20th September 2001; the above provision has been made effective from 20th September, 2001.

(G. S. Dutt)
Joint Secretary (FT & Inv.)
Tel: 3014905

Guidelines for Investment by NRIs (March 2001)

Government of India
Ministry of Finance
Department of Economic Affairs
(Investment Division)
New Delhi, dated the 8th March, 2001

PRESS NOTE

Subject: Enhancement in the limits on investments by Foreign Institutional Investors (FIIs)

1. Foreign Institutional Investors registered with SEBI are permitted to invest subject to an aggregate investment limit of 24% of the issued and paid up capital of an Indian company. In terms of the Press Note dated 1st March, 2000, the Indian companies were permitted to enhance the normal aggregate portfolio investment limit from 24% to 40% under specified special procedure.

2. In his Budget Speech 2001-2002, the Finance Minister had announced an increase in the portfolio investment ceiling applicable to Foreign Institutional Investors (FIIs). Pursuant to the announcement, Indian companies would henceforth be permitted to raise the aggregate ceiling for FII portfolio investments from the normal level of 24% to 49% of the issued and paid up capital of an Indian company subject to compliance with the special procedure viz.:

1. Approval by the Board of Directors of the Company to the enhanced limit upto 49%; and

2. A Special Resolution passed by the General Body of the Company approving the enhanced limit up to 49%.

3. Aggregate portfolio investment limits applicable to FIIs would continue to be independent of the portfolio investment limits for NRIs/PIOs/OCBs as announced in the Press Note issued on 22nd June, 1998. All other requirements governing FII portfolio investments would continue to be operative as before.

4. In terms of RBI Notification No. FEMA 41/2001-RB dated March 2, 2001; the above provision has been made effective from 2nd March, 2001.

(G. S. Dutt)
Joint Secretary (FT & Inv.)
Tel: 3014905

Guidelines for Investment by NRIs (2000)

Government of India
Ministry of Finance
Department of Economic Affairs
(Investment Division)
New Delhi, dated the 1st March, 2000

PRESS NOTE

Subject: Enhancement in the limits on investments by Foreign Institutional Investors (FIIs).

1. Foreign Institutional Investors registered with SEBI are permitted to invest subject to an aggregate investment limit of 24% of the issued and paid up capital of an Indian company. In terms of the Press Note dated 4th April, 1997, the Indian companies were permitted to enhance the normal aggregate portfolio investment limit from 24% to 30% under specified special procedure. Aggregate investment limits applicable to FIIs had also been segregated through a Press Note issued on 22nd June, 1998 from the portfolio investment limits for NRIs/PIOs/OCBs.

2. In his Budget Speech 2000-2001, the Finance Minister had announced an increase in the portfolio investment ceiling applicable to Foreign Institutional Investors(FIIs). Pursuant to the announcement, Indian companies would henceforth be permitted to raise the aggregate ceiling for FII portfolio investments from the normal level of 24% to 40% of the issued and paid up capital of an Indian company subject to:
Approval by the Board of Directors of the Company to the enhanced limit upto 40%; and
A Special Resolution passed by the General Body of the Company approving the enhanced limit upto 40%.

3. All other conditions applicable to FII portfolio investment would continue to be operative as before.

( G. S. Dutt )
Joint Secretary (FT & Inv.)
Tel : 3014905