Market experts believe that weak rupee, uncertainty over global crude prices as well as US-China trade relations have affected sentiment among foreign investors
Interest income attracts a concessional tax rate of 5%, against 15-20% in case of capital gains
These proposals would be discussed at the board meeting of Sebi tomorrow
According to the medium-term framework of the government, the limit for both central and state bonds will go up from January.
Foreign investors have pumped in Rs 1.15 lakh crore into the Indian capital markets
This country's General Anti Avoidance Rules (GAAR) on tax payments and the government's recent signing of the Multilateral Instrument (MLI) in this regard, as part of measures to prevent base erosion and profit shifting (BEPS), has already had some effects.These appear to have dissuaded foreign portfolio investors (FPIs) from shifting to European jurisdictions such as France, Spain and the Netherlands as envisaged earlier. Until April 1, FPIs took the Mauritius, Singapore or Cyprus routes to pool money from investors across the globe and invest in India. The earlier treaties we signed, amended in 2016, allowed for taxation of capital gains earned in India to be subject to tax only in the other country. Since these countries did not charge tax on capital gains, FPIs remained out of the net.Short-term capital gains in India are taxed at 15 per cent; long-term gains are exempt.FPIs that did not want their returns to get impacted from these treaty amendments were actively scouting for ...
This comes on top of close to 3,500 new foreign portfolio investors (FPIs) registering with Sebi in the past financial year
Interestingly, most of the funds have been infused in the debt markets
FPIs bid for investment limits in government debt securities to the tune of Rs 7,816 cr as against Rs 4,954 cr on offer
FPIs pulled out Rs 1,775 crore ($272 million) from equities during this period
India's macroeconomic indicators no longer seem appealing
In September quarter, foreign investors sold $3.2 bn of Indian stocks, highest among EMs
The net outflow by foreign portfolio investors (FPIs) follows withdrawal of Rs 12,770 crore from equities in August
This indicates that India remains an attractive destination for foreign portfolio investors
A falling rupee and lower foreign buying in equities are signals investors should watch out for
FPIs pulled out more than Rs 2,000 cr from equities during this period over higher stock valuations
Total investment in debt markets has crossed over Rs 1.2 lakh crore this year
FPI holding has risen by more than 1% in 73 entities
FPIs invested a net Rs 2,977 crore in equities during July 3-21
However, risks are also increasing and could trigger a change in the trend seen so far