India's central bank will remove foreign investment limits on the country's debt markets once the economy reaches its potential output over two consecutive years and foreigners move to long-end maturities, Euromoney reported Governor Raghuram Rajan as saying.

These two factors would happen "once the world becomes excited in a more substantial way about the India story", Euromoney quoted the Reserve Bank of India Governor as saying during an interview with the magazine.

Foreign institutional investors have almost exhausted their $25 billion limit in government bonds. Analysts expect India will raise the limit, although a removal has not been expected in the near term.

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