Mumbai, March 24 (IANS). The Securities and Exchange Board of India (SEBI) announced on Monday that it had increased the disclosure limit for foreign portfolio investors (FPIs) from Rs 25,000 crore to Rs 50,000 crore.
This approval was given by the market regulator in the board meeting.
The regulator said that this adjustment was necessary due to a sharp increase in trading volume in the cash equity market.
The last change in the limit of disclosure for FPI was in FY 2022-23, since then the trading volumes of the market have doubled.
After SEBI’s approval, the Indian stock market will now require a dislosure to FPIs with a holding of more than Rs 50,000 crore.
The purpose of these disclosures is to ensure compliance with the Money-Mining Prevention Act (PMLA) and related regulations.
The primary purpose of disclosure for FPI is to prevent possible misuse of investment and maintain transparency in the financial system.
The market regulator said in a statement, “FY 2022-23 (when the limit was set) and the current financial year 2024-25, the volume of business in the cash equity market has exceeded double. In view of this, the board has approved a proposal to increase the implemented limit from Rs 25,000 crore to Rs 50,000 crore.”
In addition to the increased limit for disclosure, SEBI has not made any further changes in the rules for FPI.
Currently even if more than 50 percent of equity AUMs of an FPI are concentrated in the same corporate group, they will need to give additional disclosures.
Responding to the questions asked about the changes in the rules, SEBI Chairperson Tuhin Kanta Pandey clarified that many funds including public and sovereign funds are already exempted from these additional disclocks.
Additionally, SEBI has announced a change in the rules of the Alternative Investment Funds (AIF) of the category II.
-IANS
ABS/