Increase to overseas investment limits for mutual funds

The Securities and Exchange Board of India has announced amendments to the overseas investment limits for mutual funds. The amendments provide that:

• mutual funds can make overseas investments subject to a maximum of US$1 billion per mutual fund, within the overall industry limit of US$7 billion;
• mutual funds can make investments in overseas exchange traded funds subject to a maximum of US$300 million per mutual fund, again within the overall industry limit of US$1 billion; and

in respect of investment limits to be disclosed in the scheme documents at the time of a new fund offer as specified in the relevant Circular and the investment limits on ongoing schemes as specified in the relevant Circular, such limits will henceforth be soft limits for the purpose of reporting only by mutual funds on a monthly basis in the prescribed format.