RBI Retains FPI Investment Limits in G-Secs | SGSs | Corporate Bonds
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- Last Updated on 8 April, 2026
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RBI/2026-27/07 A.P. (DIR Series) Circular No. 05; Dated: 06.04.2026
The Reserve Bank of India (RBI) has decided to retain the existing limits for Foreign Portfolio Investor (FPI) investments under the General Route for the financial year 2026–27.
1. Unchanged Investment Limits
The limits continue as a percentage of the outstanding stock of securities:
- Government Securities (G-Secs) – 6%
- State Government Securities (SGSs) – 2%
- Corporate Bonds – 15%
2. Allocation Between ‘General’ and ‘Long-term’ Categories
For G-Secs, the allocation of any incremental increase in limits (in absolute terms) between sub-categories remains:
- 50% to ‘General’ category
- 50% to ‘Long-term’ category
This ensures balanced participation across investor types.
3. Treatment of SGS Limits
- The entire increase in SGS limits (in absolute terms) will be allocated to the ‘General’ sub-category
- No allocation has been made to the long-term category for SGSs
4. Fully Accessible Route (FAR)
Investments made by eligible investors in ‘specified securities’ will be:
- Counted under the Fully Accessible Route (FAR)
- Not subject to the standard FPI limits
5. Voluntary Retention Route (VRR) Alignment
- All existing and future investments under the Voluntary Retention Route (VRR) will now be subject to the overall investment limits under the General Route
- This change will be effective from 1st April 2026
6. Objective of the Framework
The RBI’s approach aims to:
- Maintain stability in debt markets
- Ensure controlled foreign participation
- Align different investment routes under a harmonised limit structure
7. Conclusion
By retaining limits and refining allocation mechanisms, the RBI ensures a balanced, stable, and transparent framework for FPI investments in debt markets, while aligning various investment routes under a unified regulatory approach.
Click Here To Read The Full Circular
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