Market regulator SEBI will hold an auction on Monday for grant of permission to Foreign Institutional Investors for investments worth up to Rs 29,108 crore in government bonds.

At the auction to be held on the BSE platform by SEBI, FIIs would be able to bid for investment limits of Rs 24,621 crore in the long-term government debt securities and the remaining Rs 4,487 crore in other government bonds.

The two-hour auction would start at the BSE after closure of stock trading hours at 1530 hours on April 22, as per latest information available with SEBI.

SEBI said FIIs can invest in corporate debt without purchasing debt limits till the overall investment reaches 90 per cent after which the auction mechanism would be initiated for allocation of the remaining limits.

The FIIs need to bid for investment limits in an auction conducted periodically by SEBI as per the available limits, pursuant to which they can invest in the bond market.

Generally, Sebi auction debt limits for FIIs is conducted on the 20th of every month. It would be held on the next working day in case 20th happens to be a holiday.

Indian markets witnessed robust interest from FIIs last year and the momentum has continued so far. FIIs have pumped in Rs 9,368 crore so far this year, after putting in Rs 34,988 crore in the debt securities during 2012.

That was the highest annual net investment by FIIs in debt securities since 2010, when they had infused Rs 46,408 crore.

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