As a sequel to the Government's decision to permit Foreign Institutional Investors (FIIs) to invest in dated Government Securities, the Reserve Bank of India has announced the following guidelines for FIIs authorised to invest in dated Government Securities.

1. For the purpose of FII investment, dated government Securities would include dated securities of both Government of India and State Governments of all maturities, but would not include Treasury Bills.

2. Investment in dated government Securities by FIIs may be made either in the primary market at the auction/flotation or in the secondary market.

3. Investment by FIIs in dated Government Securities should be undertaken only through designated banks, i.e. any bank in India which has been authorised by the Reserve Bank to act as a banker to Foreign Institutional Investors.

4. Investment by FIIs will be allowed only in the form of Subsidiary General Ledger (SGL) Account through a bank having both SGL Account No. II (Constituents' Account) and current Account with the Reserve Bank of India.

5. The secondary market transactions by FIIs will be permitted through recognised Indian Stock Exchanges or over the counter with SGL Account holders and will be governed by the Delivery Versus Payment system of the Reserve Bank of India.