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Below the Quote on FPI Progress in June Trend by Manoj Purohit, Partner & Leader, Financial Services Tax, Tax & Regulatory Services, BDO India 

"The offshore investor fraternity adopted a vigilant approach this week while investing in the India capital market. The Central Bank and the market regulator are leaving no stone unturned to bring the foreign market participants at ease while they view India as one amongst the preferred jurisdictions to invest from a long-term perspective.

 Recently, the SEBI extended the implementation deadline by six months for key disclosure norms concerning ODIs and FPIs with segregated portfolios to provide additional time for smooth implementation. Also, the recent reduction of repo rate by 50 basis points by the Central Bank and the recent steps to remove short-term investment limits and concentration limits for investments by FPIs in corporate debt securities are the welcomed. Currently, the regulations permit investments by any FPI, including investments by related FPIs, upto 50% of any issue of a corporate debt security. This move will surely provide much needed liquidity and penetration to the bond market and enhance the attractiveness of Indian - fixed-income instruments to overseas investors.

The aforesaid announcements indeed reinforce the confidence of investors in India’s regulatory framework by demonstrating a commitment to balanced and stable market reforms. By addressing stakeholder concerns on real time basis without compromising on the integrity of the reform’s agenda, SEBI has balanced out on both transparency and investor trust. This timely and thoughtful decision projects India as a responsible and investor-friendly market, aligning regulatory changes with global best practices.

All the other factors viz. solid economic fundamentals, supportive policy measures, and favourable corporate earnings chart have kept market sentiment buoyant, signalling a constructive outlook for the near term and encouraging sustained capital flows into Indian markets for the current quarter.

As global trade conditions improve due to the easing of tensions between the US and China and the resolution of the India-Pakistan conflict, the outlook for investment in India market is becoming more positive, supported by regulatory efforts aimed at fostering foreign investment."

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