MSCI defers decision on upping India weight in index for the second time

While legroom for overseas investors in Indian firms has gone up after govt's move to automatically bring sectoral foreign investment limit under FPI, index provider seeks more clarity on changes

MSCI has deferred a decision on increasing India’s weighting in its global indices for the second time. “MSCI will defer until further notice potential increase in foreign ownership limits (FOL) resulting from the recently implemented relaxation of foreign portfolio investor (FPI) limit of Indian companies to the sectoral limit,” the index provider said.

The investment legroom for foreign investors in several Indian companies has gone up following the government’s decision to automatically treat the sectoral limit as the FPI limit. For instance, if the FPI investment limit in a company was set at 49 per cent, but the sectoral cap was