The value of P-Notes, as percentage of total assets held by foreign portfolio investors, has declined in the past few years
If the NDA government truly believes is going after black money, it should direct Sebi to close the P-note window for unidentified beneficiaries. At the very least there are political gains to be made from showing a tough stance against black money that is not mere posturing.
Stricter norms for black money: Govt not to take any knee-jerk reaction based on P-Notes, says Jaitley
To soothe nerves of jittery foreign investors after an SIT on black money suggested stricter norms for P-Notes, the government on Monday said it will not take any "knee-jerk" reaction that will will adversely impact country's investment climate.
Investment in Indian markets through P-Notesdeclined to Rs 2.36 lakh crore ($38 billion) in December from the preceding month.
Sebi has tightened rules relating to issuance of P-notes, also known as offshore derivative instruments. Here's how it could effectively curb black money.
The NDA government seems keen to invite black money back for development purposes but is afraid to say so openly. It is thus using subterfuge to lure black money back.
This is a good time for the finance ministry and the Sebi to lay a roadmap to phase out PNs, which right now appears to be serving tax evaders and shady promoters better than foreign investors
Sebi has barred "unregulated" foreign funds from dealing in offshore derivative instruments even if their investment managers are appropriately regulated by their concerned regulators.
P-Notes (participatory notes) mostly used by overseas HNIs (High Networth Individuals), hedge funds and other foreign institutions, allow them to invest in Indian markets through registered Foreign Institutional Investors (FIIs), while saving on time and costs associated with direct registrations.
If you feel there is something terribly missing, remember the proverbial three wise monkeys: see no evil; hear no evil; say no evil. After all, who would want to play the party pooper at such a time?
Foreign investments into Indian markets through participatory notes (P-Notes), a preferred route for HNIs and hedge funds, rose moderately to Rs 1.64 lakh crore (over $30 billion) in February.
Foreign investments into Indian markets through participatory notes (P-Notes), a preferred route for HNIs and hedge funds, stood at Rs 1.62 lakh crore (about $30 billion) in January.
The deferral of GAAR by the government to April 2016 has laid most foreign institutional investor (FII) concerns to rest as this provides enough time for investors to review their investment structures. The deferral is likely to support capital flows in the coming years.
P-notes is a preferred route for High Networth Individuals (HNIs) and hedge funds from abroad, which allows them to invest in Indian markets through registered Foreign Institutional Investors