Designated depository participants (DDPs) in India have begun to register foreign portfolio investors (FPIs) under the Securities and Exchange Board of India’s (SEBI) new regulatory regime.
This marks a significant step forward in the regime change in India – from the FII/QFI to the FPI framework. The FPI regime significantly eases access to the Indian markets and allows a wide variety of previously ineligible investors to participate in India. The new regime was a response from the regulators to the feedback provided by the international investor community, set in motion by SEBI to rationalize the foreign portfolio investment routes available in the country.
DDPs such as Citi’s Securities Services and Deutsche Bank worked with SEBI and the depositories to bring in the regulatory framework for the new regime and to ensure a seamless transition from the old regime. The issuance of the FPI registration certificate was facilitated by the National Securities Depository Limited (NSDL).
Citi acted on behalf of one of the first investors under the new regime. “The inherent attractiveness of the Indian markets, has kept India as a focal point of our securities business and we are pleased to roll out this new framework for our global clients”, says Aashish Mishra, head of Securities Services for Citi in India.
“We have been continuously involved with the development of the Indian securities markets, from being the first to enable securities lending and borrowing for our clients in India, to facilitating the largest QFI investment to being the first custodian to offer e-voting facility for company board meetings for our clients,” he adds.
Deutsche Bank has been appointed as DDP and custodian bank for CMI Ventures’ investments in India. The company is an affiliate of Catalyst Microfinance Investors, a $125 million microfinance investment fund, which opened an FPI account with Deutsche Bank India. Catalyst Microfinance Investors’ promoters include Sequoia, an independent corporate finance advisory, investment management and private equity investment firm of the Netherlands, and ASA of Bangladesh. CMI Ventures is expected to fund greenfield microfinance institutions in India.
Anand Rengarajan, head of Investor Services, India at Deutsche Bank, says: “The new investor access framework under the FPI regime could be a game changer for global investors as it provides them with a more efficient way to invest in India.”
Martijn Bollen, general counsel at CMI Ventures, adds: “We are delighted to expand our relationship with Deutsche Bank. We valued their ongoing engagement globally and locally, as well as their guidance throughout our FPI registration process. We look forward to continuing to work with their global team.”
HSBC also registered an FPI on the first day of the scheme.
Custodians Facilitate Access to India’s New Foreign Portfolio Investor Regime
Designated depository participants (DDPs) in India have begun to register foreign portfolio investors (FPIs) under the Securities and Exchange Board of India’s (SEBI) new regulatory regime.