Compliance
India Clarifies Foreign Ownership Of Private Banks
India has for decades operated relatively tough restrictions on foreign ownership of businesses such as banks.
A group of foreign funds and investment firms can own more than
51 per cent of India’s IDBI Bank, the country has
confirmed.
The Reserve Bank of India restricts foreign ownership in new
private banks.
The central bank's residency criteria for promoters applies only
for newly set up banks and does not cover an existing entity like
IDBI Bank, the Department of Investment and Public Asset
Management said in a response to interested bidders' queries.
According to Reuters (6 December) the clarifications
come ahead of a 16 December deadline to submit expressions of
interest for a majority stake in IDBI Bank, one of the few
lenders that the government is trying to offload its stake
in.
The story also highlights how India’s financial services industry
has started to move away from a heavily protectionist model
adopted since the nation’s independence more than 70 years ago.
India has received $58.8 billion foreign direct Investment in the financial year 2022, according to Business Today.
