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The notice, which does not require personal presence, was issued about 10-12 days ago by the federal probe agency under the provisions of the Foreign Exchange Management Act (FEMA).
In a FEMA investigation, a show cause notice is issued after the conclusion of the investigation, and is similar to the violation penalty prescribed in it.
The investigation pertains to the end use of ₹2,000 crore raised by KIIFB through masala bonds and compliance with FEMA norms.
KIIFB (Kerala Infrastructure Investment Fund Board) is the primary agency of the state government for financing large and critical infrastructure projects and had raised ₹2,150 crore in 2019 through its maiden masala bond issue as part of its plan to raise ₹50,000 crore to finance large and critical infrastructure projects in the state.