RBI excludes 14-year and 30-year tenor G-Secs from FAR for foreign investors

The Reserve Bank of India (RBI) announced on Monday the exclusion of government securities (G-Secs) with 14-year and 30-year tenors from the Fully Accessible Route (FAR) for foreign portfolio investors (FPIs).

Following a review and in consultation with the government, the RBI decided to exclude all new securities of these tenors from the FAR. Consequently, future issuances of G-Secs in 14-year and 30-year tenors will not be available for investment under the FAR.

"Existing stocks of Government Securities in 14-year and 30-year tenors already included as 'specified securities' under the Fully Accessible Route shall, however, continue to be available under the Fully Accessible Route for investments by non-residents in the secondary market," the RBI stated in a notification.

According to the RBI's April calendar, the FPI limit for G-Sec General is set at Rs 2,67,890 crore and Rs 1,36,890 crore for the G-Sec Long Term category for the current fiscal year.

Currently, all investments by eligible investors in the 'specified securities' are accounted for under the Fully Accessible Route. The limit for FPI investment in government securities is 6 per cent of outstanding stocks of securities for the current fiscal year.

(With PTI inputs)