The issue of Foreign Currency Convertible Bonds and Ordinary Shares (through Depository Receipt Mechanism) Scheme, 1993 was formulated at a time when India's capital markets were substantially closed to foreign capital and the domestic financial system was not very well developed. The Scheme of 1993, envisages Depository Receipts (DRs) being issued only against equity shares as underlying securities and restricts such issuances to raising fresh capital by issuance of shares sponsored by the issuing company only. In the last two decades, the equity market has developed considerably with sophisticated market infrastructure with active participation by both domestic and foreign investors as capital controls have been eased substantially. In this period, the Indian legal and regulatory system for financial markets has evolved with substantial changes. These developments warranted a fresh look at the Scheme governing the issuance of Depository Receipts (DRs).