mumbai, Sept. 25 -- The Securities and Exchange Board of India (Sebi) board has approved a proposal to allow foreign portfolio investors (FPI) into physically-settled non-agri commodity derivatives, along with a slew of other measures, at its board meeting on Thursday. Foreign investors will now be allowed to trade in non-agricultural index derivatives because such contracts are cash settled, regardless of the nature of their underlying commodities. For physically settled non-agricultural commodities, FPIs would have to square off positions before the start of the tender or staggered delivery period, three days before expiry. FPIs currently have access to non-agricultural commodity derivatives that are cash settled, while bullion and base-metal contracts are physically deliverable. If they do not do so, open positions could be automatically transferred to a designated trading member or trading-cum-clearing member's proprietary account. The move is aimed at improving foreign investor participation in India's commodity markets, which would help boost volumes in the segment. "We have been receiving representations from exchanges and market participants seeking to widen the scope of FPI participation in the Indian commodity derivatives markets," said Sebi chairman Tuhin Kanta Pandey at a press conference. The regulatory board has also approved an overhaul of portfolio management services (PMS) regulations. The Sebi board has allowed portfolio managers' route for investing in mutual fund units (PRIM) to offer professionally managed portfolios of mutual fund investments. PMS firms can now introduce mutual-fund-only PMS schemes, which would allow portfolio managers to offer professionally managed portfolios of mutual fund investments. This would allow portfolio managers to manage client money in direct plans of mutual fund schemes. The new norms would also allow access to overseas markets through investments in listed foreign equities, listed debt securities and overseas mutual funds, as well as overseas real estate investment trusts. PMS allows professional fund managers to manage customized investment portfolios for affluent investors, with minimum investment set at Rs.50 lakh. "The expanded investment universe-including IPOs, overseas securities and a wider range of debt instruments-gives portfolio managers greater flexibility to build more diversified portfolios around clients' needs. These changes can significantly broaden the relevance and reach of portfolio management services in India," said Anshul Sharan, co-founder and chief executive officer at Ametra PMS....