According to the RBI's April 2025 announcement, what is the revised limit for FPI investment in corporate bonds for FY 2025-26?

Correct option is A

The correct answer is (a) 15%

Explanation:
• The Reserve Bank of India (RBI) maintained the investment limit for Foreign Portfolio Investors (FPIs) in corporate bonds at 15% of the outstanding stock for FY 2025-26.
• This limit is part of the Medium-Term Framework (MTF) for FPI investment in debt.
• The decision aims to balance foreign capital inflows with domestic financial stability.
• Limits for Government Securities (G-Secs) and State Development Loans (SDLs) were also reviewed concurrently.
• Macroprudential considerations guide these limits to prevent excessive volatility in the bond market.

Information Booster:
• FPIs can invest in Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) under specific categories.
• The Fully Accessible Route (FAR) allows FPIs to invest in specified G-Secs without any quantitative limits.

Additional Knowledge:
10% (Option b)
• This is often a standard individual FPI limit in a single company's equity, but not the aggregate corporate bond limit.
18% (Option c)
• This figure does not correspond to the current regulatory ceiling set by the RBI for corporate debt.
12% (Option d)
• While suggested by some market analysts for calibration, the RBI officially stuck to the 15% threshold.

So the correct answer is (a)