The
government has shown a preference to distinguish
overseas corporate bodies (OCBs) from NRIs, groups
of NRIs and companies owned by non-resident Indians,
as far as their access to secondary and primary
markets is concerned.
While
being diligent in enforcing the RBI-imposed bar
on OCBs from entering the markets, the government
appreciates that a similar dispensation for genuine
NRI investors would be unfair. The FIPB’s
Core Group, slated to meet soon would attempt to
lay down the criteria for identification of NRI
status or otherwise of entities intending to invest
in India. Shell companies or firms with characteristics
of OCBs would be warily identified and prevented.
The
RBI had banned OCBs’ access to secondary market
via the portfolio investment scheme in November
‘01, following the recommendations of the
joint parliamentary committee that had probed the
security market scam. In September this year, the
central bank banned these bodies from investing
in primary market as well.
“OCBs
as an investor class have ceased to exist with the
recent RBI de-recognition. At the same time, genuine
NRI and NRI-controlled companies are often suspected
for disguised OCBs. If we are able to identify the
NRI investor who is not an OCB as defined, the onus
of additional formalities could be waived,”
sources said. |
