As a measure of further liberalization and to facilitate increased floating stock of shares of large Indian companies having equity base of Rs.1,000 crore and above, it has been decided to enhance the threshold limit, beyond which Foreign Institutional Investors/Non Resident Indians investing in these companies are required to obtain prior clearance from the Reserve Bank. Accordingly, this threshold limit is now fixed at 0.5 per cent below the limit upto which non-resident investments are permitted in such companies. This is expected to lead to better price discovery for investors.

Presently, this limit is at 2 per cent below the applicable limits.

Revised operating instructions are being issued to the designated banks.

P.V. Sadanandan
Manager