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Informist, Tuesday, Nov. 19, 2024

 

NEW DELHI – Commerce and Industry Minister Piyush Goyal Tuesday said he will hold discussions with Finance Minister Nirmala Sitharaman and the market regulators to ease know-your-customer norms for foreign portfolio investors. However, he said the government will not compromise on the "sanctity of hot money coming" into the Indian capital market.

 

"I think possibly there may be bureaucratic hurdles which I would love to hear from you (investment groups)," Goyal said at the 27th CITIC CLSA India Forum in Mumbai. "Then I can talk to the honourable finance minister and other regulators to see how we can bring that time (to register in India as an FPI and make investment) down."

 

Goyal said this after some attendees at the event said FPIs had complained about the long time it takes for them to register in India. It usually takes them six to eight months to get money into the Indian markets. In the past, foreign investors have also said that they face problems with meeting India's stringent know-your-customer norms for onshore trade.

 

The talk to ease various compliance processes for FPIs to invest in the Indian market has gained steam after the inclusion of government securities in global indices of J.P. Morgan and Bloomberg. In September, Ananth Narayan, whole-time member of the Securities and Exchange Board of India, had said that the regulator was exploring ways to have a light-touch registration process for FPIs who commit to investing only in gilts.

 

Goyal asked CLSA to highlight the hurdles that FPIs face while making investments in India. "I am happy to still look at how we can cut down the KYC process or eliminate some of the unnecessary stuff that delays money coming in," he said.

 

"I think India has benefitted from being a cautious country to attract foreign investment. One of the reasons we have been successful is that we have made sure that money coming into the country is not hot money," Goyal added. "Money is not being round-tripped, that it goes out of India and comes back into the stock market and heats the market."  End

 

Reported by Krity Ambey

Edited by Ashish Shirke

 

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