Millennium Post

Centre not mulling ban on P-Notes to check black money

The government on Friday said it is not considering any proposal to ban Participatory Notes (P-Notes) as part of efforts to check black money.

"There is no proposal at present to remove participatory notes in order to check the generation and laundering of black money," Minister of State for Finance Jayant Sinha said in a written reply in the Lok Sabha. P-Notes, or offshore derivative instruments, are mostly used by overseas HNIs, hedge funds and other foreign institutions to invest in Indian markets through registered foreign institutional investors (FIIs), while saving on time and costs associated with direct registrations.

In a separate reply, Sinha said the total net investments in equity and debt made by FIIs and Foreign Portfolio Investor in India between April-November stood at over Rs 1.84 lakh crore. The total investment by FIIs and FPIs in 2013-14 was Rs 51,649 crore. The FPI regime has classified foreign investors into three groups and would eventually replace existing categories such as FIIs, their sub-accounts and qualified foreign investors.
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