3 weeks ago

India may flag Bloomberg's G-Sec index inclusion delay

India may flag Bloomberg's G-Sec index inclusion delay
Govt may flag index inclusion delay with Bloomberg · financialexpress.com

India borrows money by selling special savings papers called government bonds, which are known as G-Secs.

A company called Bloomberg keeps a big list of bonds from many countries, called the Global Aggregate Bond Index.

When a country's bonds are on that list, many foreign investors want to buy them.

India recently made it easier and cheaper for foreign investors to buy its bonds.

India wanted Bloomberg to add its bonds to the big list.

But Bloomberg said it needed more time to see if the new rules were working well.

India is not happy about waiting and thinks it already did everything needed.

Adding India to the list could lower India's borrowing costs and help support its currency, the rupee.

So India may talk to Bloomberg to ask for a faster decision.

Key facts

Index
Bloomberg Global Aggregate Bond Index
Bloomberg statement date
August 1
FPI G-Sec holdings (Aug 10)
Rs 4.33 lakh crore (3.76% of outstanding stock)
FPI G-Sec holdings (May 12)
Rs 3.75 lakh crore (3.34%)
FAR G-Sec holdings
Rs 3.73 lakh crore (6.95%), up from Rs 3.21 lakh crore
FCNR(B) inflows
Around $43 billion; window open until September 30
Government-RBI package announced
June 5
Tax exemption effective
April 1, 2026 (interest income, short-term and long-term capital gains)

Quotes

Unnamed official

Indian government representative

“Many market participants would like to see these enhancements become more firmly established in day-to-day market practice before a decision is made on index inclusion, "Bloomberg said in a statement on August 1."”
financialexpress.com
“We opened up the whole (G-sec) spectrum from 1 year to 40 years maturity and gave tax relief, "an official said, calling the liberalisation a "holy grail."”
financialexpress.com

Madan Sabnavis

Chief Economist, Bank of Baroda

“I think the deferment was not really required as the government had already gone along with several steps on this front. My sense is that this could have been done mainly due to the global uncertainty prevailing where they may have chosen to stick to the status quo.”
financialexpress.com

Sources

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