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India to allow foreign companies to raise funds locally
By agencies
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Tuesday, 14 February 2006, 20:30 IST
MUMBAI: India plans to allow foreign companies to raise funds in the local capital markets to meet the rising demand for shares, M. Damodaran, SEBI chief said.
The Securities & Exchange Board of India will also reduce the time taken for the share-sale process in the next two months, Damodaran said in Singapore. The process currently takes ``several months,'' compared with 15 days required for selling global depositary receipts, he said.
``We are very close to putting in place regulatory prescriptions for companies registered outside of India to raise money in the Indian markets,'' he said. ``We will seek to match that of GDRs in time, in efficiency and in cost.''
The regulator's move to further open India's markets will encourage companies at home and overseas to tap the local markets to raise funds and list shares. That, in turn, will be key to currency convertibility, analysts said.
``What does it mean for foreign companies? Clearly, there will be more Indian stocks that are available for investors,'' easing concerns that ``Indian markets have too much money and too little stocks,'' he said. ``We are seeing more non-Indian companies coming to markets to raise money.''