Earlier this month, India announced details of its new system to allow foreign individual investors to invest directly in the local market – somewhat to my surprise, since when this proposal emerged in November, I though there was a big question mark over whether they would ever be implemented.
So what do the details look like? While the investors will be known as qualified foreign investors (QFIs), the restrictions to be qualified look less tough than we light had expected. Essentially it seems that they will need to be residents of a country that comply with standards on money laundering and are members of the Financial Action Task Force.
However, it was always too much to hope that such a bureaucratic government would allow unhindered access for foreigners to its markets. At first glance, the system is rather cumbersome and is unlikely to see a flood of foreigners into Indian shares.