Deputy General Manager

Division of Foreign Institutional Investors & Custodians

Investment Management Department

Circular No. IMD/FII & C/33/2007

October 16, 2008

All Foreign Institutional Investors

through their designated Custodians of Securities

Sub: FII investments in Debt Securities

1.The Government of India has reviewed the External Commercial Borrowing policy and has increased the cumulative debt investment limit from US $3 billion to US $6 billion for FII investments in Corporate Debt.

2.Accordingly the enhanced limit for investment in corporate debt shall be allocated among the FIIs on a ‘first come first served’ basis in terms of our Circular dated January 31, 2008, subject to a ceiling of US $300 million per registered entity.

3.The debt requests in this regard shall be forwarded to the dedicated email id . The mailbox shall open at 23:59 PM IST, October 20, 2008.

4.Further in order to accord flexibility to the FIIs to allocate the investments across equity and debt, it has been decided to do away with the conditions provided in regulation 15(2) of SEBI FII regulations pertaining to restrictions of 70:30 ratio of investment in equity and debt respectively, with immediate effect. Necessary amendments to the FII Regulations will be carried out in due course.

5.A copy of this circular is available at the web page “F.I.I.” on our website The custodians are requested to bring the contents of this circular to the notice of their FII clients.

Yours faithfully, 

Jeevan Sonparote

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