New Delhi: India’s central bank is set to raise the investment cap for individual foreign investors in listed companies from 5% to 10%. This move aims to attract more capital into the stock market, according to government officials and reviewed documents.
Foreign investors have pulled out over $28 billion since September due to weak earnings, high valuations, and concerns over U.S. tariffs. To counter this, India plans to extend investment benefits to all foreign investors, not just overseas Indians.
The Reserve Bank of India (RBI) also plans to raise the combined holding limit for all foreign individuals from 10% to 24%. The proposal is in its final stages of discussion with the government and the market regulator, SEBI.
However, SEBI has raised concerns over monitoring these investments. It warned that a single foreign investor, along with associates, could surpass the 34% takeover threshold. Regulators are now working to prevent possible rule violations.
The reforms are expected to be implemented soon to stabilize capital inflows and boost investor confidence.
