New Delhi, Sep 30 (Inditop.com) Commodity exchanges in which foreign holding has exceeded permissible levels will get time till March to bring down the excess foreign holding, the government said Wednesday. The earlier deadline ended Sep 30.
As per the guidelines, commodity exchanges attract a composite ceiling for foreign investment of 49 percent.
This, however, is subject to the condition that investment under the portfolio investment scheme is limited to 23 percent and that under the foreign direct investment (FDI) scheme is limited to 26 percent.
However, it was found that some commodity exchanges had foreign holdings above the permitted level, following which these exchanges were directed to bring down such investment to the approved levels by Sep 30, a government statement said.
“Difficulties have been brought to the notice of the government in complying with the provisions of the press note within the stipulated time frame,” said the statement.
“The government, on consideration and in order to facilitate the existing Commodity Exchanges to comply with the guidelines, has now decided to allow a further complying/correction time,” it added.
Thus commodity exchanges have time till March 31, which the government says would also be the last opportunity to comply with the guidelines.
“Non-compliance of the conditions after March 31, 2010 would be a violation of the Foreign Exchange Management Act, 1999.”
