FinMin still in talks with RBI to raise FII limit in govt debt: sources

The finance ministry is still in talks with the Reserve Bank of India (RBI) about raising foreign institutional investment (FII) limit in government debt, two finance ministry sources with direct knowledge of the matter told Reuters on Tuesday.

[caption id=“attachment_131631” align=“alignleft” width=“380” caption=“RBI Governor Subbarao had said in late October any decision on the matter needed to take into account external sector viability issues. Reuters”] [/caption]

The sources said the government has not finalised the timeframe for raising the limit nor has the amount of increase in the limit been finalised.

Currently, the limit stands at $10 billion.

India’s most traded new 10-year bond rose 1 basis point to 8.94 percent after the finance ministry sources comments.

The RBI Governor Subbarao had said in late October any decision on the matter needed to take into account external sector viability issues, besides the government’s borrowing needs.

Reuters