UPSC CSE Prelims
Question 91
Which of the following is issued by registered foreign portfolio investors to overseas investors who want to be part of the Indian stock market without registering themselves directly?
View correct answer and explanation
Correct answer: D
Correct Option: D
Explanation:
Participatory Notes (P-notes) are offshore derivative instruments issued by registered foreign portfolio investors to overseas clients who seek economic exposure to Indian securities without directly registering as FPIs.
Option-wise Analysis:
A (Incorrect): Certificates of deposit are bank-issued deposit instruments, not offshore equity exposure notes.
B (Incorrect): Commercial paper is unsecured short-term corporate debt.
C (Incorrect): A regular promissory note represents a debt promise, not the specific FPI derivative.
D (Correct): Participatory Notes provide indirect Indian stock-market exposure.