Rich overseas entities, investing in Indian markets through Participatory Notes (P-Notes), are estimated to have pulled out over Rs 1 lakh crore (about $20 billion) in less than three months on fears of getting caught in the government's taxation net and its black money trail. As a result, the quantum of money invested through these P-Notes has hit its rock-bottom levels of just about 10% of total FII ( foreign institutional investment) holdings — which used to be more than 50% a few years ago. P-Notes allow foreign HNIs (high-networth individuals) and other rich investors to invest in India through already-registered FIIs, while saving on time and costs associated with direct registrations.

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