SECURITIES AND EXCHANGE BOARD OF INDIA
MUTUAL FUND DEPARTMENT
Mittal Court, A Wing, Gr. Floor,
224, Nariman Point, Mumbai 400 021

MFD/CIR No.4/ 052 /99
September 1, 1999

To:

All Mutual Funds registered with SEBI/ Unit Trust of India

Dear Sir,

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Re.: Investments in ADRs/GDRs by Mutual Funds.

The Reserve Bank of India, in consultation with the Government of India and SEBI has decided to allow the mutual funds to invest in ADRs/GDRs issued by Indian Companies.

Accordingly, all mutual funds will henceforth be permitted to invest in ADRs/GDRs initially within overall limit of US$500 mn. with a sub-ceiling for individual mutual fund which should not exceed 10% of the net assets managed by them as on the date of the last audited balance sheet, subject to a minimum of US $20 mn. and a maximum of US$50 mn. per mutual fund.

The mutual funds shall also have to obtain approval from RBI to invest in overseas markets from exchange control angle.

You are advised to forward us your proposal for undertaking such investments and the amount which is proposed to be invested by your schemes in ADRs/GDRs. The proposal should also give details of the modalities for making such investments and engaging the services of overseas intermediaries, if any.

Yours Faithfully,

P.K. Nagpal
DIVISION CHIEF
MUTUAL FUNDS DEPARTMENT

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