SEBI proposes steps to boost resident Indian participation in FPIs via IFSC schemes

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  • Last Updated on 12 August, 2025

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SEBI consultation paper resident Indian participation FPIs IFSC schemes IFSCA regulations foreign portfolio investors

Consultation Paper Dated 08.08.2025

1. SEBI Seeks Public Comments on FPI Reforms


The Securities and Exchange Board of India (SEBI) has released a Consultation Paper inviting public feedback on proposals aimed at facilitating greater participation of resident Indians in Foreign Portfolio Investors (FPIs). The initiative seeks to broaden investment opportunities and strengthen India’s engagement with global capital markets.

2. Inclusion of IFSC-Based Retail Schemes


One of the key proposals is to allow International Financial Services Centre (IFSC)-based Retail Schemes, with resident Indian non-individual sponsors or managers, to register as FPIs. This move is expected to provide resident investors with a regulated channel to invest in foreign securities through the IFSC framework.

3. Alignment with IFSCA Regulations


SEBI has also proposed to align the FPI contribution limits with the IFSCA (Fund Management) Regulations, 2025. This harmonization aims to ensure consistency between SEBI’s regulatory framework and IFSCA’s provisions, creating a streamlined compliance environment for market participants.

4. Participation of Indian Mutual Funds in FPIs


Another notable proposal is to permit Indian Mutual Funds to be constituents of FPIs. By enabling mutual funds to participate in FPIs, SEBI intends to diversify the investor base and encourage cross-border portfolio diversification for Indian investors.

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied