SWAGAT-FI Framework: Streamlining Foreign Investment in India

Posted On - 3 December, 2025 • By - Asha Kiran Sharma

Introduction 

The Securities and Exchange Board of India (SEBI) has introduced the SWAGAT-FI (Single Window Automatic & Generalised Access for Trusted Foreign Investors) framework to simplify access for foreign investors into the Indian securities market. The initiative seeks to reduce procedural complexity for both Foreign Portfolio Investors (FPIs) and Foreign Venture Capital Investors (FVCIs), facilitating seamless registration, compliance, and investment in India. 

Single Window Registration 

SWAGAT-FI provides an optional single-window registration mechanism, allowing foreign investors to register as FPIs and FVCIs without submitting separate documentation. This enables: 

  • Investment in listed equity and debt instruments as FPIs. 
  • Investment in unlisted Indian companies and startups as FVCIs. 

Additionally, SEBI-registered Alternative Investment Fund (AIF) managers are required to onboard foreign investors while ensuring: 

  1. The investor is resident in a jurisdiction whose securities regulator is a signatory to the IOSCO Multilateral Memorandum of Understanding (MoU). 
  1. Neither the investor nor its beneficial owner appears on the United Nations sanctions list. 
  1. The investor or its beneficial owner does not belong to a country listed on the Financial Action Task Force (FATF) blacklist. 

By meeting these criteria, SWAGAT-FIs simplify onboarding of foreign investors into AIFs. 

Registration and KYC Periodicity

Under current regulations: 

  • FPIs renew registration and submit documentation every three years; KYC reviews occur annually or every three years depending on risk classification. 
  • FVCIs renew registration every five years; KYC reviews occur annually or every five years based on risk classification. 

SWAGAT-FI proposes to extend registration and KYC periodicity up to ten years, while retaining the obligation to update any material changes. This aligns with RBI’s Master Directions, which permit KYC updates for lower-risk clients every ten years. 

Participation of NRIs, OCIs, and RIs 

Currently, FPIs are subject to a 50% aggregate cap on contributions from Non-Resident Indians (NRIs), Overseas Citizens of India (OCIs), and Resident Indians (RIs). SWAGAT-FI, aimed at attracting retail investors, proposes removing this cap. No restrictions apply to FVCIs under the new framework. 

Single Demat Account Option 

Under the existing regime, foreign investors are required to maintain separate demat accounts for FPI and FVCI investments. SWAGAT-FI proposes allowing investors to maintain one demat account, with backend tagging mechanisms to distinguish investments as FPI, FVCI, or other foreign investor types. This reduces duplication in onboarding and KYC processes. 

Draft Amendments to FPI and FVCI Regulations 

To operationalize SWAGAT-FI, SEBI has proposed draft amendments to the FPI Regulations, 2019 and FVCI Regulations, 2000: 

FPI Regulations: 

  • Introduce a definition for “SWAGAT-FI.” 
  • Provide exemptions from certain provisions. 
  • Extend registration fees validity from three to ten years. 

FVCI Regulations: 

  • Introduce a definition for “SWAGAT-FI.” 
  • Provide exemptions from certain provisions. 
  • Extend registration fees validity from five to ten years. 

Designated depository participants will collect fees in advance and remit them to SEBI in accordance with the revised timelines. 

Public Consultation

SEBI has invited stakeholders to provide feedback on: 

  • Introduction of SWAGAT-FI. 
  • Eligibility criteria for foreign investors. 
  • Single-window registration for FVCIs. 
  • Ten-year registration and KYC periodicity. 
  • Removal of NRI, OCI, and RI contribution caps. 
  • Optional single demat account. 
  • Draft amendments to FPI and FVCI regulations. 

Conclusion

The SWAGAT-FI framework represents a significant step toward simplifying foreign investment in India. By introducing single-window registration, extended KYC periodicity, removal of contribution caps, and a unified demat account option, SWAGAT-FI streamlines compliance while ensuring alignment with existing regulatory requirements, thereby creating a more investor-friendly environment.