Participatory notes are back in favour since amended tax treaties and GAAR (General Anti Avoidance Rules) brought Indian laws closer to international compliance norms with effect from April 1.
P-notes are overseas derivative instruments with Indian stocks as their underlying assets. The increasing interest in P-notes is also the result of many banks or prime brokers—about 13 of them based in Europe and the US—launching and aggressively marketing several P-note products to attract investors.
