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ARTICLE · 07 MAY 2015

Revised Position Limits For Foreign Portfolio Investors (FPIs) In ETCD

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Also, FPIs shall be allowed to take positions, together in EUR-INR, GBP (British Pound Sterling)-INR and JPY (Japanese Yen)-INR pairs, up to USD 5 million.

IndiaFinance and Banking
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The Reserve Bank of India on March 31, 2015, loosed its noose, bringing further liberalization by increasing the limits of position taken by Foreign Portfolio Investors (FPIs) in the Exchange Traded Currency Derivatives (ETCD), vide circular RBI/2014-15/527 under the Foreign Exchange Management Act, 1999.

Presently, FPIs can take position- both long (bought) as well as short(sold)- in foreign currency up to USD 10 million or equivalent per exchange. Now limit is increased in USD-INR pair up to 15 million per exchange. Also, FPIs shall be allowed to take positions, together in EUR-INR, GBP (British Pound Sterling)-INR and JPY (Japanese Yen)-INR pairs, up to USD 5 million.

These limits shall be monitored by the exchanges and braches, if any, shall be reported to RBI. Exchanges may also fix the limits of the contracts in currencies other than USD, provided these limits are within the equivalent of USD 5 million.

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