Today, the Reserve Bank released the results of the 2017-18 round of the Survey of Foreign Liabilities and Assets of Mutual Fund (MF) Companies on its website. The survey covers 42 Indian MF companies and their Asset Management Companies (AMCs), which held/acquired foreign assets and/or liabilities during the reference year 2017-18 and/or in the preceding year (See Annex for list of companies).

Highlights:

I. Mutual Fund Companies:

• Foreign assets of MF companies declined by 11.7 per cent; however, their foreign liabilities increased by 19.3 per cent, with their net foreign liabilities at ₹ 824.3 billion (US$ 12.7 billion) in March 2018 (Table 1).

• UAE, UK, Singapore, USA, Mauritius and Hong Kong together accounted for 49 per cent of the MF units held by non-residents in March 2018; units (at face value) held in Mauritius and Singapore declined (by 11 per cent each), coinciding with the signing of the Protocol to amend the ‘India-Mauritius Double Taxation Avoidance Agreement (DTAA)’ in 2016-17 and ‘India-Singapore DTAA’ effective since April 2017 (Table 2).

• Luxembourg and USA remained the major overseas investment destinations for MFs companies with Mauritius regaining importance as a preferred overseas investment destination (Table 4).

II. Asset Management Companies:

• Net foreign liabilities of AMCs associated with MFs increased by 132.7 per cent to ₹121.0 billion (US$ 1.9 billion) in March 2018 over the previous year; foreign liabilities of AMCs were largely owed to non-residents in Japan (increased by 698 per cent), Mauritius and UK whereas Guernsey was the main destination of their relatively small overseas assets (Tables 5, 6 & 7).

• The reinvested earnings of foreign direct investors in the AMCs (estimated from their share in the difference between a company’s net profit and distributed dividends) stood at ₹ 9.7 billion in 2017-18.

Ajit Prasad
Assistant Adviser

Press Release : 2018-2019/460