India's market watchdog bids to boost foreign investment
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India's market regulator on Tuesday announced an overhaul of existing regulations for foreign investors, in a bid to attract crucial inflows to the country's capital markets.
India's stock markets and currency have weakened in recent weeks -- the rupee to a record low last week -- as overseas funds have pulled out money towards safer forms of investment on seeing the US economy recover.
The Securities and Exchange Board of India (Sebi) said in a statement it had approved changes including "simplified and uniform entry norms for foreign investors" by merging existing foreign groups into "a new investor class".
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At its board meeting in Mumbai, Sebi also approved changes to the rules to allow start-ups and small and medium enterprises to list on stock exchanges without an initial public offering, in a bid to boost entrepreneurship.
The proposal was approved with a "view to provide easier exit options for informed investors", Sebi said, providing "better visibility, wider investor base and greater fund raising capabilities" for start-ups.
While India is seen as a hub of entrepreneurs and huge business potential, the country has of late appeared to be failing its promising startup companies, which have struggled to find investors.
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It is one of the toughest countries in the world for a startup to flourish, according to a 2012 report by US-based research firm Startup Genome, and investments from venture capitalists have reportedly dropped between 2011 and 2012.