New
Delhi: The foreign direct investment (FDI) limit in
private banks has been raised to 74 per cent under the
automatic route from the existing 49 per cent.
The
guidelines notified yesterday by the Department of Industrial
Policy and Promotion has, however, placed a limit of 49
per cent on foreign institutional investor (FII) holding
within the overall FDI limit.
The
notification said that the 74 per cent limit would include
"aggregate foreign investment from all sources."
This would include portfolio investment scheme by FIIs,
non-resident Indian investment, investments by overseas
corporate bodies, private placement, GDR/ADR, acquisition
of shares from existing shareholders and investment made
by any foreign investor in public offerings of the banking
entity.
On
the FII investment limit would ordinarily be 24 per cent.
This could, however, be raised to 49 per cent by the board
of directors
of the bank passing a resolution followed by a special
resolution by the general body. The 10 per cent limit
for the holding of an individual FII has been retained.
|