MUMBAI: The markets regulator Securities and Exchange Board of India (SEBI) has eased the compliance for those foreign portfolio investors (FPIs) who want to invest only in government securities.
In a circular issued on Monday, SEBI said, "FPIs investing only in government securities shall not be required to furnish investor group details," thus reducing the regulatory compliance burden on them for solely investing in G-Secs.
In September 2025 through an amendment, the Sebi and RBI had exempted FPIs investing only in G-Secs via the fully accessible route from a lot of compliance burden. The new rule broadens the relief to all FPIs investing only in Gsecs, regardless of the route.
The latest directive follows a Reserve Bank direction dated June 5, 2026, which removed the concentration limit requirement for FPIs investing in Gsecs via the general route, making the process of identifying investor groups for G-Sec-only FPIs obsolete.
“With a view to providing greater ease of investment to FPIs, the Reserve Bank had on June 5, 2026, withdrawn the requirement for FPIs investing in Gsecs through the general route to comply with the prescribed concentration limit. Consequently, the requirement for identification of investor group by an FPI investing only in Gsecs is no longer relevant and is therefore being removed,” the Sebi circular said.
Sebi has also directed depositories, custodians, and designated depository participants to make the necessary changes to their systems to effect these changes, as the provisions of this circular come into force immediately.
