RBI Maintains FPI Investment Limits in G-Secs for FY27

• The Reserve Bank of India (RBI) announced that the investment limit for Foreign Portfolio Investors (FPIs) in government securities (G-Secs) through the general route will remain at 6 percent of outstanding stocks for 2026-27.
• The allocation of incremental changes in the G-Sec limit between General and Long-term sub-categories is retained at 50:50 for FY27.
• Limits for FPI investment in State Government Securities (SGSs) and corporate bonds will also remain unchanged at 2 percent and 15 percent, respectively, for the General Route.
• An additional limit of Rs 3,30,464 crore has been set for 2026-27.
• From April 1, 2026, all investments under the Voluntary Retention Route will be subject to the investment limits stipulated for FPI investments under the General Route.

Key Questions Answered

How will these FPI limits impact India's bond market?

The RBI has kept FPI investment limits in G-Secs unchanged for FY27 at 6%.

What is the future outlook for foreign investment in G-secs?

The investment limit for Foreign Portfolio Investors (FPIs) in government securities (G-secs) will remain unchanged at 6% for FY27.

Will these unchanged limits affect the Indian rupee?

Yes, the unchanged limits on lenders' daily onshore currency positions at $100 million are expected to affect the Indian rupee.