Sebi board clears single window gateway for low risk foreign investors

Mumbai, Sep 12 (PTI) The Sebi board on Friday decided to make it easier for low risk foreign investors to participate in the Indian securities market with the introduction of a single window access, a move aimed at simplifying compliance and enhancing the country's attractiveness as an investment destination.

The new framework -- Single Window Automatic & Generalised Access for Trusted Foreign Investors (SWAGAT-FI) -- would provide easier investment access to low risk foreign investors, enable a unified registration process across multiple investment routes and reduce repeated compliance and documentation for such entities, Sebi Chairman Tuhin Kanta Pandey told reporters here after the board meeting.

The low risk foreign investors identified by Sebi include government-owned funds, central banks, sovereign wealth funds, multilateral entities, highly regulated public retail funds, and appropriately regulated insurance companies, as well as pension funds.

"The board approved the introduction of the SWAGAT-FI framework for FPIs and ForeignVenture Capital Investors (FVCIs) with the objectives to facilitate easier investment access for objectively identified and verifiably low risk foreign investors, enable a unified registration process across multiple investment routes for these entities and  minimize repeated compliance requirements and documentation for such investors," he said.

As of June 30, 2025, India had 11,913 registered FPIs, holding assets worth Rs  80.83 lakh crore and SWAGAT-FIs are estimated to contribute more than 70 per cent of total FPIs' assets under custody, according to a Sebi data.

Under the approved framework, the regulator would grant an option to SWAGAT-FIs applying for registration/ already registered as FPIs to also register as FVCI, without the need for any further documentation.

Registration under both FPI and FVCI regulations will enable SWAGAT-FIs to invest in listed equity instruments and debt securities of Indian companies as FPI, and in unlisted Indian companies engaged in specified sectors and startups as FVCI under respective regulations.

To enhance ease of compliance, the regulator decided to increase the periodicity for continuance of registration, including payment of fee and review of KYC documentation to 10 years, up from the current three-year or five-year periods.

It has permitted the use of a single demat account for holding all securities acquired as FPI or FVCI or as foreign investor investing in units of investment vehicles, on an optional basis. Further, depositories will tag investments to ensure regulatory supervision.

Also, it has decided to remove the restriction on aggregate non-resident Indian (NRI), Overseas Citizen of India (OCI) and Resident Indian individuals (RI) contributions in SWAGAT-FIs.

At present, aggregate contribution from non-NRI, OCI and RI in an FPI is capped at 50 per cent of the total corpus.

" Given the necessary system and process modifications, a six-month timeframe has been provided for the full implementation of the SWAGATFI framework," Sebi said.

To enhance the ease of doing business for FPIs operating from International Financial Services Centres (IFSCs),  Sebi board approved a proposal to also allow retail schemes in IFSCs with a resident Indian sponsor or manager, to register as FPIs.

Currently, Alternative Investment Funds in IFSCs with a resident Indian sponsor or manager are permitted to register as  FPIs.

Sebi noted that the limits on sponsor contribution by resident Indian non-individuals in funds set up in IFSC,as specified by Sebi and International Financial Services Centres Authority (IFSCA), were at variance, leading to the risk of non-compliance by such entities.

To address this, the board approved a proposal to amend FPI Regulations so that such sponsor contributions be subject to a maximum of 10 per cent  of corpus of the Fund (or AUM, in case of retail schemes).

The board noted the launch of a new website titled ‘India Market Access’ (www.indiamarketaccess.in), developed as a dedicated platform for current and prospective FPIs.

"To address a long-standing demand for a streamlined and consolidated source of regulatory and procedural information, a single-window digital platform- ‘India Market Access’- has been developed," Sebi noted.

This portal serves as a 360 degree digital gateway to facilitate seamless entry and ongoing compliance for foreign investors in India’s securities markets. PTI AA SP ANU