📰India Just Doubled How Much You Can Invest

Good afternoon, 

Welcome to the best way to stay up-to-date on India’s financial markets. Here’s what’s in today’s newsletter:

• India is set to double the investment limit for individual foreign investors,

• India has announced a lower-than-expected borrowing plan for the first half of the fiscal year,

• and, India’s digital media industry has overtaken television for the first time, becoming the largest segment in the country’s media sector.

Then, we close with Gupshup, a round-up of the most important headlines.

Have a question you want us to answer? Fill out this form and you could be featured in our newsletter.

—Shreyas, [email protected]

Market Update.

India Just Doubled How Much You Can Invest.

India is set to double the investment limit for individual foreign investors in listed companies to 10 percent, a move aimed at reviving capital inflows amid a global selloff, according to government officials and documents reviewed by Reuters. The Reserve Bank of India (RBI) has been in discussions with the finance ministry and market regulator SEBI to finalize the change, which could be implemented soon.

Foreign investors have been pulling money out of Indian stocks, offloading more than $28 billion since the Nifty 50’s record high in September. A mix of high valuations, weak earnings, and concerns over U.S. trade policies has dampened sentiment. The proposed relaxation of foreign investment rules is meant to reverse this trend, bringing in much-needed liquidity at a time when global capital is becoming increasingly selective.

Currently, only Non-Resident Indians (NRIs) and Overseas Citizens of India (OCIs) can hold up to 5 percent in an Indian listed company under the Foreign Exchange Management Act (FEMA). The new policy would extend this privilege to all foreign investors and raise the aggregate cap for overseas individual holdings from 10 percent to 24 percent.

While the RBI and the government are pushing for the change, SEBI has flagged potential challenges in monitoring compliance. The regulator warns that a single investor, when combined with associates, could accumulate more than 34 percent in a company, potentially triggering takeover regulations. Under Indian law, crossing the 25 percent threshold requires an open offer to retail shareholders.

Foreign institutional investment has long played a crucial role in India’s markets. As of early 2025, FPIs hold around 18 percent of India’s listed equity market, according to NSDL data. The proposed changes could make India’s investment regime more attractive compared to other emerging markets like Indonesia and Brazil, which have fewer restrictions on foreign ownership.

The government is weighing SEBI’s concerns while working on a framework to prevent regulatory loopholes. If finalized, the new rules would mark one of the most significant shifts in India’s foreign investment policy in years, reflecting New Delhi’s broader push to position itself as a more accessible and competitive global market.

India’s Low Government Borrowing Stands as Bullish.

India has announced a lower-than-expected borrowing plan for the first half of the fiscal year, a move that is likely to bolster the bond market. The government plans to issue $93.2 billion (₹8 trillion) worth of bonds between April and September.

The lower borrowing target is expected to have a positive impact on Indian bonds, which have already seen strong performance this year. Investor sentiment has been buoyed by expectations of an interest rate cut at the RBI’s policy meeting on April 9. 

The borrowing for the first six months accounts for 54 percent of the full-year target of $172 billion (₹14.8 trillion), a slight reduction from the typical 60 percent share during the period. According to the government, the benchmark 10-year bond will represent 26.2 percent of total issuance, while shorter-maturity bonds will account for 25 percent, and long-term 30- to 50-year bonds will make up 35 percent. Additionally, 100 billion rupees of green bonds will be issued.

Bond yields have responded positively to the news. The yield on India’s 10-year benchmark bond fell to a three-year low of 6.58 percent on Thursday, driven by the RBI’s liquidity measures. The central bank has injected over $60 billion (₹5.1 trillion) into the financial system over the past two months to address a liquidity deficit that had reached a decade-high shortfall. 

Other bullish factors: Indian bonds have also benefited from increased demand by domestic insurance and pension funds, as well as foreign investors. Overseas investors have poured $3 billion into rupee bonds so far this month, the highest inflow since 2017. Looking ahead, while foreign investment may slow as India gains full weight in the JPM index, the RBI is projected to buy up to $11.7 billion (₹1 trillion) worth of bonds starting in April.

Indians Spend 1.1 Trillion Hours On Their Phones.

India’s digital media industry has overtaken television for the first time, becoming the largest segment in the country’s $29.1 billion (₹2.5 trillion) media and entertainment sector. Indians collectively spent 1.1 trillion hours on their smartphones in 2024, averaging five hours daily, with nearly 70 percent of that time devoted to social media, gaming, and video streaming.

Main drivers: The surge in digital consumption has been driven by cheap internet access and the rapid expansion of 5G, with subscriptions more than doubling to 270 million. Smartphone penetration has also reached 562 million users — more than the combined populations of the US and Mexico. Notably, 40 percent of internet users are now from rural areas, highlighting the deep reach of digital services.

New expectations: This shift describes a digital inflection with expectations of industry consolidation, new business models, and partnerships in the coming years. Companies such as Meta, Amazon, Reliance’s Jio, and even Elon Musk’s ventures are competing for a share of this massive digital market.

Traditional media, including television, print, and radio, saw their revenues and market share decline in 2024. However, live events, such as concerts and cricket tournaments, continued to drive industry growth. India’s media and entertainment sector will continue to expand to $36 billion (₹3.1 trillion).

Message from our sponsor.

Get the Story Behind the Story

Do you crave the intersection of money and power or are you simply curious what C.E.O.s to the SEC Chair read to know what’s really happening behind closed doors on Wall Street to the White House? Look no further than Puck, built in partnership with an elite team of authors covering the inside story at the nexus of Wall Street, Washington, Hollywood, media, fashion, sports, and art.

Unlock exclusive stories and insider intel on the forces shaping power, money and culture.

Start your 14-day free trial

Reach out to [email protected] to sponsor the next newsletter!

Gupshup.

Macro

• The Reserve Bank of India is expected to cut interest rates at its April 9 meeting and again in August, as per a Reuters poll of economists. With inflation at a seven-month low and growth forecasts weak, economists anticipate a 25 basis point cut in April and a total of 75 basis points in rate reductions for the cycle, which would be the shortest easing cycle on record.

• India blocked the entry of a Tanzania-flagged tanker carrying 800,000 barrels of Russian oil due to improper certification, sources said. The vessel, Andaman Skies, was bound for Indian Oil Corp but lacked approval from India’s maritime authorities, reflecting stricter scrutiny of Russian crude shipments.

• Indian bank loan growth slowed for the eighth consecutive month in February, rising 12 percent year-on-year compared to 16.6 percent a year earlier, as RBI’s stricter rules on personal and credit card loans curbed lending. The slowdown follows regulatory efforts to reduce risk, though a recent easing of capital requirements may support future growth.

• Indian alloy steel producers plan to file an anti-dumping petition against cheap Chinese imports, citing a surge in low-priced steel bars and rods entering the country. The industry group, which includes JSW Steel and Jindal Steel, aims to seek trade protections through India’s federal trade ministry.

Equities

• India's quick commerce sector drove over two-thirds of all e-grocery orders in 2024, with its market size surging nearly fivefold to $6-7 billion from 2022, a Bain and Flipkart report revealed. While rapid deliveries fuel expansion beyond groceries, experts warn that profitability challenges and competition from major e-commerce players could test its long-term sustainability.

• Tata Motors fell 5 percent and Tesla’s top Indian supplier, Sona Comstar, dropped over 4 percent after Donald Trump announced a 25 percent tariff on imported cars and auto parts, set to begin in April. The move hit global automakers, with Jaguar Land Rover, Toyota, Hyundai, and Stellantis also seeing declines.

• Indian authorities seized uncertified products worth over $88,000 from Amazon and Flipkart warehouses in Delhi, escalating a quality control crackdown. The Bureau of Indian Standards cited missing or fake certification labels on items like geysers, food mixers, and sports shoes.

Alts

• Saudi Aramco is in talks to invest in two major refinery projects in India, including those by ONGC in Gujarat and BPCL in Andhra Pradesh. Aramco aims to supply oil three times the value of its stake in each project as it seeks stable outlets in India's fast-growing market.

Policy

• India’s market regulator, SEBI, has proposed restricting equity derivatives expiries to Tuesdays or Thursdays to streamline trading and curb speculation. Exchanges will need approval for any changes, and public feedback is open until April 17.

See you Friday.

Written by Yash Tibrewal. Edited by Shreyas Sinha.

Disclaimer: This is not financial advice or recommendation for any investment. The Content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.