Foreign individuals can now invest in India

India announced on Sunday that it would open up its stock market to individual foreign investors for the first time, in a major economic reform designed to boost overseas investment.

The Indian economy has grown strongly over the last 15 years and many foreign investors have been keen to enter the market in a fast-developing country of 1.2 billion people.

 However recent financial data has been disappointing, with the main Sensex index for the Mumbai market recording a 25 per cent plunge in 2011 and many analysts predicting more falls in 2012.

 The government said in a statement that it had taken the move "in order to widen the class of investors, attract more foreign funds, and reduce market volatility and to deepen the Indian capital market."

It said the reforms would be put into operation by January 15.

 Previously, foreign investors were only allowed to invest in the stock market via mutual funds or institutional schemes.