The Securities and Exchange Board of India (SEBI) has proposed a new rule to track the source of foreign money for high-risk investors in an effort to root out questionable foreign investment in India’s publicly traded companies. If passed, the new rule would require any investor with more than INR 250 billion ($3.3 billion) invested locally or if they have a concentration of over 50% in any one Indian business group, to disclose full ownership details. Although some experts worry about excessive compliance, SEBI’s consultation paper estimates that only 6% of foreign investment, or less than 1% of total market capitalization, will be considered high risk.
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