Foreign small investors may get to trade in Indian stocks

Written by Reuters | New Delhi | Updated: Nov 18 2011, 07:06am hrs
India plans to allow foreign retail investors to trade in local stocks, a finance ministry official said, a move that could help fund flows into Indian shares. A qualified foreign investor (QFI) is an individual, group or association in a foreign country adhering to specific guidelines. Currently, foreign investors need to have a net worth of $50 million and register as a sub-account of a foreign institutional investor to invest directly.

We are looking at allowing QFIs to invest in equities without capping such an investment, said the official, who declined to be named. The move is seen as positive for Indian stocks, which are down nearly 20% in 2011. The move is extremely good. It will help attract foreign fund flows into the Indian market, said Ambareesh Baliga, chief operating officer at brokerage firm Way2Wealth.