Record low FPI investments via Participatory notes

Mumbai: Foreign portfolio investors' (FPIs) exposure to Indian equity market through offshore derivative instruments (ODIs) or participatory note also referred to as P-Note reduced further to 2.3 per cent of the total assets under custody from 3.4 per cent in the financial year 2017-18, the Economic Survey said.

The absolute value of ODI investments fell to a record low of Rs 78,110 crore in FY 2018-19 as against Rs 1,06,403 crore in FY2017-18.

"Direct FPI investment is rising now with Mauritius route frozen with long term capital gains tax and foreign investors realising that with closer scrutiny it is better to register in India and bring money directly," Kishore P Ostwal, CMD, CNI Research said.

The survey said the notional value of ODIs on equity, debt & derivatives in 2018-19 decreased to 2.3 per cent, or Rs 78,110 crore, of total assets under custody of the FPIs of Rs 33,42,680 crore.