Sebi panel to bat for merger of FPI, NRI fund inflows

​New Delhi: A Sebi panel may soon suggest merger of foreign portfolio investment and NRI/ OCI routes to bring in a single regime for foreign investors and regulate NRI fund inflows, senior officials said. 

Besides, the panel may suggest to the capital markets regulator to clarify suitable actions that FPIs need to take for divestment or re-classification of holdings as per the FDI limits after consultation with the Reserve Bank, they said. 

Further, it is likely to suggest Sebi to consult the government to evolve a more objective criteria for defining high-risk jurisdictions. The panel headed by former RBI Deputy Governor H R Khan, which is reviewing FPI regulations, may soon suggest these measures.  "The panel is examining whether any recommendation to merge the FPI and NRI/ OCI (Overseas Citizens of India) routes of investment can be made to the government and the Reserve Bank," the official said. 

Under Portfolio Investment Scheme, NRIs can directly invest in Indian firms and buy equity stocks and mutual funds among others. NRI investments are controlled by foreign exchange management act and follow Sebi regulations. 

The move is aimed at helping Sebi in regulating and maintaining reporting of NRIs (Non-Resident Indians), besides assisting NRIs to invest through FPI in a regulated regime. Last month, the panel had suggested changes on several contentious proposals and more time for compliance.