In a significant policy change, the Reserve Bank of India (RBI) has announced the exclusion of all new securities with 14-year and 30-year tenors from the Fully Accessible Route (FAR) for non-resident investments.

This decision comes after a thorough review and consultation with relevant authorities, the RBI said in a circular.

As a result of this decision, future issuances of Government Securities in these tenors will not be available for investment under the FAR. However, the existing stock of government securities in 14-year and 30-year tenors already classified as ‘specified securities’ will remain accessible to non-residents in the secondary market, RBI said.

For Foreign Portfolio Investors (FPIs), any new Government Securities issued in these tenors will be subject to investment limits outlined in AP (DIR Series) Circular No. 03 dated April 26, 2024, along with the conditions specified in A.P. (DIR Series) Circular No. 31 dated June 15, 2018, as amended, RBI said.

Alternatively, investments may also be governed by the limits and conditions outlined in A.P. (DIR Series) Circular No. 22, dated February 10, 2022, depending on the circumstances, RBI added.

This policy adjustment aims to streamline the investment framework and enhance regulatory clarity for foreign investments in India’s government securities market.