Singapore: Temasek Holdings and the Government of Singapore Investment Corp (GIC) will be treated as separate entities for the purpose of investments in Indian banks, Indian External Affairs Minister, Pranab Mukherjee, was quoted as saying on 18 June.
“I believe the Reserve Bank of India has approved the request for enhancement in equity holdings by Temasek and GIC, and will acknowledge the acquisition of shares when that happens,” Mukherjee told the Straits Times newspaper in an interview.
India’s central bank has in the past raised objections about Singapore investments in the country because Indian banking regulations say no single foreign entity can hold more than 10% equity in an Indian bank.
The newspaper said that even though an agreement between Singapore and India allowed the GIC and Temasek to act as separate entities, India’s central bank treated them as a single entity, as they are both owned by the Singapore government. That had blocked Singapore from taking more than a 10% stake in companies such as ICICI Bank.
Temasek has a 7.37% stake in ICICI while GIC owns 2.24%, according to ICICI’s website.