RBI doubles sub-limit for long-term foreign investors in govt securities
Current · Source: Reserve Bank of India · RBI/2013-14/473 · issued 29 Jan 2014 · ~2 min read
Quick answerRBI has doubled the sub-limit for SEBI-registered long-term investors (SWFs, pension funds, etc.) in government dated securities from USD 5 billion to USD 10 billion, effective immediately, within the overall USD 30 billion cap for foreign investment in government securities.
The rule, in the simplest words
Long-term foreign investors (like pension funds and sovereign wealth funds) can now invest up to USD 10 billion in government bonds (loans to the government), double the old limit of USD 5 billion.
This new limit is part of the total USD 30 billion allowed for all foreign investors in government securities (bonds).
The change is effective immediately, and all other rules for these investments stay the same.
Banks must update their systems and tell customers about the new higher limit.
How it plays out — a real example
A treasury officer in Indore receives a call from a pension fund manager in London asking about the new limit. The officer explains that the fund can now invest up to USD 10 billion in Indian government bonds, double the previous limit, and confirms that the bank can process the investment as long as it stays within the overall USD 30 billion cap.
What changed
The sub-limit for long-term investors (SWFs, multilateral agencies, pension/insurance/endowment funds, foreign central banks) in government dated securities has been raised from USD 5 billion to USD 10 billion. This change is effective immediately and remains within the total USD 30 billion limit for foreign investment in government securities. All other existing conditions for such investments stay unchanged.
What it means for you
Banks and AD Category-I entities can now facilitate larger investments from long-term foreign investors in government dated securities, potentially increasing demand and lowering yields. This move signals the government's intent to attract stable, long-term capital flows into the debt market. Lenders should prepare for higher volumes of such investments and ensure compliance with SEBI's operational guidelines.
What you must do
Update internal systems and reporting to reflect the new USD 10 billion sub-limit for long-term investors in government dated securities.
Inform customers and constituents about the enhanced limit and ensure they are aware of SEBI's operational guidelines.
Monitor investments to ensure they stay within the overall USD 30 billion cap and comply with all unchanged conditions.
Coordinate with SEBI for any operational clarifications or reporting requirements.
Who it affects
AD Category-I banks, SEBI-registered long-term investors (SWFs, multilateral agencies, pension/insurance/endowment funds, foreign central banks), FIIs and QFIs investing in government securities, Indian companies issuing NCDs/bonds
❓ Common questions
What is the new sub-limit for long-term investors in government dated securities?
The sub-limit has been doubled from USD 5 billion to USD 10 billion, effective immediately, within the overall USD 30 billion cap for foreign investment in government securities.
Which investors are covered under this enhanced sub-limit?
SEBI-registered long-term investors such as Sovereign Wealth Funds (SWFs), multilateral agencies, pension funds, insurance funds, endowment funds, and foreign central banks.
Do any other conditions for investment change?
No, all other existing conditions for investment in government securities remain unchanged. Only the sub-limit for long-term investors has been increased.
📜 Read the original circular — full text as issued by RBI
RBI/2013-14/473
A.P. (DIR Series) Circular No.99
January 29, 2014
To,
All Authorised Persons
Madam/ Sir,
Foreign investment in India by SEBI registered Long term investors in
Government dated Securities
Attention of Authorized Dealer Category-I (AD Category-I) banks is invited to Schedule 5 to the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000 notified vide Notification No. FEMA.20/2000-RB dated May 3, 2000 , as amended from time to time, in terms of which SEBI registered Foreign Institutional Investors (FIIs), SEBI registered Qualified Foreign Investors (QFIs) and long term investors registered with SEBI may purchase, on repatriation basis Government securities and non-convertible debentures (NCDs) / bonds issued by an Indian company subject to such terms and conditions as mentioned therein and limits as prescribed for the same by RBI and SEBI from time to time.
2. Attention of AD Category-I banks is also invited to A.P.(DIR Series) Circular No.111 dated June 12, 2013 in terms of which the present limit for investments by FIIs, QFIs and long term investors in Government securities stands at USD 30 billion, out of which a sub-limit of USD 5 billion is available for investment by long term investors in Government dated securities.
3. On a review, it has now been decided, in consultation with Government of India to enhance, with immediate effect, the existing sub-limit of USD 5 billion available to long term investors registered with SEBI – Sovereign Wealth Funds (SWFs), Multilateral Agencies, Pension/ Insurance/ Endowment Funds and Foreign Central Banks for investment in Government dated securities to USD 10 billion, within the total limit of USD 30 billion available for foreign investments in Government securities.
4. The operational guidelines in this regard will be issued by SEBI.
5. All other existing conditions for investment in Government securities remain unchanged.
6. AD Category – I banks may bring the contents of this circular to the notice of their constituents and customers concerned.
7. The directions contained in this circular have been issued under sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.
Yours faithfully,
(Rudra Narayan Kar)
Chief General Manager-in-Charge
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2013-14/473 · issued 29 Jan 2014. The plain-English explanation above is BankPulse’s own independent summary.
Update internal systems and reporting to reflect the new USD 10 billion sub-limit for long-term investors in government dated securities.
📜 Compliance
Inform customers and constituents about the enhanced limit and ensure they are aware of SEBI's operational guidelines.
Monitor investments to ensure they stay within the overall USD 30 billion cap and comply with all unchanged conditions.
Coordinate with SEBI for any operational clarifications or reporting requirements.
Grouped from the action items above — a single circular may involve more than one team.
Worked example & action-note template
Example: if you are an IT/Systems lead at a bank this circular applies to (AD Category-I banks, SEBI-registered long-term investors (SWFs, multilateral agencies, pension/insurance/endowment funds, foreign central banks), FIIs and QFIs investing in government securities, Indian companies issuing NCDs/bonds), your first concrete step on “RBI doubles sub-limit for long-term foreign investors in govt securities” is: “Update internal systems and reporting to reflect the new USD 10 billion sub-limit for long-term investors in government dated securities.” (RBI issued this 29 Jan 2014).
Circular: RBI/2013-14/473 -- RBI doubles sub-limit for long-term foreign investors in govt securities
Issued: 29 Jan 2014
Action required: Update internal systems and reporting to reflect the new USD 10 billion sub-limit for long-term investors in government dated securities.
Action required: Inform customers and constituents about the enhanced limit and ensure they are aware of SEBI's operational guidelines.
Action required: Monitor investments to ensure they stay within the overall USD 30 billion cap and comply with all unchanged conditions.
Action required: Coordinate with SEBI for any operational clarifications or reporting requirements.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.
💬 Banker Discussion
Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.
BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly). Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=8721&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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