FPIs lap up Rs 15,000 crore govt bonds on limit hike

Foreign Portfolio Investors have lapped up government debt securities, including state bonds, worth nearly Rs 15,000 crore within days of limits being hiked for these instruments. With effect from October 12, an additional Rs 16,431 crore was available for investment in various government bonds following an increase in investment limits by RBI and Sebi. 

Out of this, investment limits worth about Rs 5,600 crore were allotted through an e-auction, while the rest was available on tap. As per the latest data available with NSDL (National Securities Depository Ltd), a total investment limit worth Rs 1,545 crore has been available for investing in government securities as on October 16, while those for state bonds has been at Rs (-)62 crore. RBI and Sebi earlier this month allowed greater foreign fund flows into government securities, which are generally favoured by FPIs over the corporate bonds in India. Following this, additional limits have been available. In further opening up, the limits would be enhanced by another Rs 16,600 crore from January 1 ownwards.