In line with its efforts to attract more foreign direct investment (FDI), Finance Minister Arun Jaitley said on Monday in his Budget for 2016-2017 that the foreign investment limit in Indian stock exchanges has been raised to 15 percent from the current five percent.
It could pave the way for the listing of the Bombay Stock Exchange, Asia's oldest stock exchange.
"Investment limit for foreign entities in Indian stock exchanges will be enhanced from 5 to 15% on par with domestic institutions," said Jaitley during his budget speech.
Foreign investors in the BSE include Deutsche BÃ¶rse AG, Singapore Exchange Ltd, US billionaire George Soros's hedge fund Quantum's Mauritius investment arm Quantum (M) Ltd, Canada-based investor Thomas Caldwell's Caldwell India Holdings Inc. and US fund Argonaut Private Equity.
"BSE welcomes the proposal to increase the stake a foreign exchange can hold in an Indian exchange from 5% to 15% to bring it on par with Indian entities. This will also help attract more investments in India by creating stronger links with the best foreign exchanges," Ashishkumar Chauhan, MD & CEO, BSE, said in a statement.
In January this year, Indian capital markets regulator Securities and Exchange Board of India (Sebi) had relaxed some of the clauses pertaining to the listing of bourses.
The BSE has been making efforts since 2012 to get listed when it hired 14 banks to advice it on the modalities. The BSE would engage the same set of firms now also for its IPO, the Mint had quoted a source familiar with the development as saying on condition of anonymity.
The BSE was established on Jul. 9, 1875, at Dalal Street, and was one of the many places hit during a series of bomb blasts on Mar.12, 1993.