India’s  exchange traded note (ETN) India has been suspended from issuing new shares after regulators in the country banned the fund from trading offshore derivatives.

Indian regulators barred iPath MSCI India (NYSEArca: INP) from trading offshore derivatives, which sheds new light on how overseas investments can go off track, reports Ian Salisbury for The Wall Street Journal. Barclays said it was going to cooperate fully with the authorities, but the company isn’t commenting about what it means in a broader sense for the exchange traded product industry. (The differences between ETFs and ETNs).

Since India restricts foreign investment activity, Barclays uses derivatives to  replicate the returns of the MSCI index that tracks Indian stocks. Regulators accused Barclays of failing to provide them with accurate details about its offshore trades and thus banned it from conducting further activities, the Journal said.

Exchange traded products have has their share of upheavals this year, particularly when commodity focused funds faced scrutiny from the Commodity Futures Trading Commission (CFTC). (Funds are bracing for regulations).

Once Barclays announced the Indian regulators’ decision, the ETN’s shares jumped 2.6% to $63.91, a bigger gain than other ETFs that weren’t affected by the decision. (Are India ETFs too hot?)