https://www.business-standard.com/a...75-bn-assets-could-be-hit-118090300903_1.html
Foreign portfolio investors (FPIs) have upped their ante against a circular issued by the market regulator, Securities and Exchange Board of India (Sebi), on beneficial ownership of offshore funds.
At least a dozen FPIs, including Amansa Capital, Helios and
Morgan Stanley Asset Management — which operate from outside India but have links to the county — wrote to the prime minister, finance minister and Sebi, saying that the move will hit a third of the overseas assets in the country.
According to Asset Managers Roundtable of India (Amri), such funds account for assets worth $75 billion in India. They would be forced to unwind their positions by December if the regulator does not provide relief. "It is preposterous and highly irresponsible to claim that 75 billion dollars of FPI investment will move out of the country because of SEBI's circular issued in April 2018," said
Sebi in a statement.
The circular will affect not only boutique India-dedicated funds founded by non-resident Indians (NRIs), but also some of the funds managed by top global institutions who have appointed NRIs or even a person of Indian origin (PIO) as their fund managers.
“The
Sebi circular clashes with the stated objective of the government to encourage more offshore fund managers to relocate to India. The fraternity is not wary about disclosure of the end-beneficiaries. The real issue is that it places severe restrictions on
FPIs being managed by PIOs or NRIs. Both
Sebi and the government should take cognisance of several genuine funds that would be affected by the circular,” said Nishith Desai, founder, Nishith Desai Associates.