New Delhi: The Union Cabinet on Wednesday allowed a foreign company to own up to 15 per cent in the domestic stock or commodity exchanges as against five per cent currently.
The decision is aimed at attracting more foreign inflows in stock exchanges like BSE and the NSE. “The Cabinet has given its approval for raising foreign shareholding limit from five per cent to 15 per cent in Indian stock exchanges for a stock exchange, a depository, a banking company, an insurance company, a commodity derivative exchange,” said a spokesperson.
The Cabinet has 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 Cabinet also approved abolition of existing “guidelines for establishing JVs by Defence PSUs.
