Finance Ministry Mulls Raising FII Investment Sub-Limit In Government Bonds

NEW DELHI: Government is considering hiking the FII investment sub-limit in its bonds to $25 billion without disturbing overall $30 billion FII debt cap, a top finance ministry official said.

"There is general demand and there is a space to increase FII limit in government debt...No intent to increase overall $30 billion FII debt cap," Finance Secretary Arvind Mayaram said.

Currently, India allows FIIs of up to $ 30 billion in government bonds, including $20 billion for all and $10 billion for specific investors like foreign central banks, sovereign wealth funds, pension funds and insurance funds.

The limit under $ 20 billion has been almost fully exhausted.

"There is demand and space for rejigging existing FII debt window, we may use $5 billion unutilised sovereign wealth funds ( SWF) as part of FII debt cap," Mayaram said.

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