INSUBCONTINENT EXCLUSIVE:
This was in a bid to calm markets after recent regulatory changes.Overseas investors of Indian origin are allowed to buy up to 5 per cent in
any security under current regulations, Economic Affairs Secretary Subhash Chandra Garg said on Tuesday, in a bid to calm markets after
(Securities and Exchange Board of India) that said foreign investment rules for companies of Indian origin had been tightened.The guidelines
say a company majority owned by non-resident Indians (NRIs) or persons of Indian origin (PIOs) will not be allowed to invest as a foreign
portfolio investor (FPI) in the country, and Sebi has directed that such funds should be closed or their ownership structure changed by the
end of December.According to a source familiar with the matter, policymakers informally told some investors that there was little chance of
the new guidelines being relaxed, which fueled the markets' plunge.Mr Garg reiterated that companies majority-owned by non-residents Indians
will not be allowed to invest and manage foreign funds, indicating that any relaxation of the guidelines was unlikely.Lakshmi Iyer, fixed
income head at Kotak Mutual Fund, said, "the overhang of this news is acting as a catalyst and aggravating the already battered market
sentiment."On Tuesday, the rupee fell to a record low of 71.58 to the dollar while the benchmark 10-year bond yield rose up to 8.07 per
cent, its highest since December 2, 2014
The broader NSE stock index closed down 0.54 per cent.Fear of contagion from the economic woes in Argentina and Turkey have driven investors
away from emerging markets, and the rupee is the worst performing emerging Asian currency, having lost nearly 11 per cent of its value this
year.And investors in India were further alarmed on Tuesday by a statement released by Asset Manager's Roundtable of India (AMRI), a group
of fund managers that represent institutional investors, including those of Indian origin based abroad.AMRI warned that Sebi's new
guidelines cast a shadow over $75 billion worth of foreign funds that are managed by Indians, and makeup nearly 17 per cent of the total
$450 billion of existing foreign portfolio investments.Sebi swiftly responded with its own statement, saying "it is preposterous and highly
irresponsible to claim that $75 billion of FPI (foreign portfolio investors) investment will move out of the country because of SEBI's
