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Below Quote on Quote SEBIs consultation paper disclosure by FPI from Vinod Nair, Head of Research at Geojit Financial Services.

The framework is an extension of the ongoing SEBI FPI regulation, aiming to identify the source of income and control the flow of foreign investment in accordance with FATF (Financial Action Task Force) guidelines. We believe that it will not significantly impact the trend of FII inflows as legitimate qualified foreign investors like sovereigns to pension funds will be classified as low to moderate risk category, which is presumed to account for the majority of FPI aum. Any potential impact may arise for those deemed high risk FII’s due to concentrated exposure in limited companies or groups, which could have an effect on a stock-to-stock basis.

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