By Suvashree ChoudhuryCHENNAI, India (Reuters) - The Reserve Bank of India (RBI) is committed to steadily increasing how much government debt foreign investors can buy, but will proceed cautiously to avoid becoming too reliant on overseas capital, Governor Raghuram Rajan said on Thursday.Rajan added India would examine debt limits twice a year, hinting at a more formal decision-making process. At present, the government decides on the caps in consultation with the Reserve Bank of India and capital markets regulator Securities and Exchange Board of India.India's current limit of $25 billion ...
India's central bank and markets regulator are discussing plans to examine the foreign investment limit in government debt. Foreign institutional investors have almost exhausted the $30bn limit imposed in 2013 on purchases of sovereign debt and policy makers are considering ways to ease investment whilst trying to shield India from volatility such as a potential increase in US interest rates. The Reserve Bank' Governor, Raghuram Rajan, said that the government is already in talks with Euroclear and Clearstream on a plan to make it easier for foreigners to trade the bonds whilst keeping transactions within India.