Private Banks to be Excluded from New FDI Guidelines
Apr. 30 – India’s private sector banks may be excluded from the new foreign direct investment guidelines if their status is changed from “resident” to “‘foreign.”
“There is a probability that we will exempt these banks from the guidelines on the lines of the exemptions in the insurance sector,” an official said told The Economic Times.
Under the revised FDI guidelines, several private sector banks will have to change their status would from “resident” to “non-resident.” This is because total FDI will now account for even the stakes held by non-resident Indians, American and global depository receipts, foreign currency convertible bonds and convertible preference shares.
The Reserve Bank of India has said that according to the policy, foreign investment in these banks would exceed 50 percent in the new policy regime and they will be treated as non-resident entities. Some of the well-known private sector banks include ICICI Bank, HDFC Bank and Vysya Bank.