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P-Note Surge In Indian Markets

P-Note Surge In Indian Markets:

In November 2023, there was an increase in participatory note investments, reaching a total of ₹1.31 lakh crore.

  • Participatory Notes (P-Notes) are financial instruments used by foreign investors who wish to invest in Indian markets without directly registering with the market regulator, the Securities and Exchange Board of India (SEBI).
  • They are issued by registered foreign institutional investors (FIIs) or their sub-accounts against underlying Indian securities.
  • While P-Notes offer flexibility and ease of investment, they have been a subject of regulatory scrutiny due to concerns about their potential use in money laundering, round-tripping, and lack of transparency.