No proposal to ban P-Notes
Moneylife Digital Team 12 December 2014

P-Notes, or offshore derivative instruments, are mostly used by overseas HNIs, hedge funds and other foreign institutions to invest in Indian markets

 

The government said that it does not propose to ban Participatory Notes (P-Notes), as part of its policy to check inflow of 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. This is done when they invest in Indian markets through registered foreign institutional investors (FIIs). It saves on time and costs which are 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 (FPI) in India between April-November stood at over Rs1.84 lakh crore.
 
The total investment by FIIs and FPIs in 2013-14 was Rs51,649 crore.
 
The FPI regime has classified foreign investors into three groups based on their risk profile. This will eventually replace existing categories such as FIIs, their sub-accounts and qualified foreign investors.
 
Comments
Free Helpline
Legal Credit
Feedback