Union Cabinet Increases Limit for Foreign Investment in Stock Exchanges from 5% to 15% [ Current Affairs ]


Union Cabinet has given its approval for raising foreign shareholding limit from current 5 % to 15 % in Indian Stock Exchanges. Decision carries the investment limit of foreign units at par with that of domestic organization.

Image shows the funds

Image shows the funds

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  • This enriched limit is for a stock exchange, depository, banking company, insurance company, and commodity derivative exchange.
  • In addition, the Union Cabinet also gave its approval for foreign portfolio investors to acquire shares through initial allotment, besides secondary market, in the stock exchanges.


  • Enhance global competitiveness of Indian stock exchanges. Enable Indian stock exchanges to acquire and adopt latest technology and global best practices.
  • Development of a strong financial services market in India.
  • The investors from the onslaught of jobbers and brokers, and ensure better tax compliance to pave the wayfor regulation, growth and development of financial services,


  • Union Cabinet approval is in pursuance of implementation of the 2016 - 17 Budget Announcement made by the Union Finance Minister Arun Jaitley.
  • Finance Minister had made this announcement with respect to reforms in FDI Policy in order to improve investment limit for foreign entities in Indian stock exchanges from 5 % to 15%.

- Published on: July 28, 2016