Zee Media Bureau
New Delhi: The Union Cabinet in a meeting chaired by Prime Minister Narendra Modi on Wednesday gave its approval for raising foreign shareholding limit from 5 percent to 15 percent in domestic stock exchanges for a stock exchange, a depository, a banking company, an insurance company, a commodity derivative exchange.
The Cabinet also approved the proposal to allow foreign portfolio investors to acquire shares through initial allotment, besides secondary market, in the stock exchanges.
The move will help in enhancing global competitiveness of Indian stock exchanges by accelerating/facilitating the adoption of latest technology and global best practices which will lead to overall growth and development of the Indian capital market.
The approval is in pursuance of implementation of the Budget announcement made by the Finance Minister Arun Jaitley while presenting the Union Budget 2016-17 regarding reforms in FDI policy with respect to enhancement of investment limit for foreign entities in Indian stock exchanges from 5 percent to 15 percent on par with domestic institutions.