India’s Bond Market— Developments and Challenges Ahead
Wells, Stephen; Schou-Zibell, Lotte | December 2008
Abstract
"While India boasts a world-class equity market and increasingly important bank assets, its bond market has not kept up. The government bond market remains illiquid. The corporate bond market, in addition, remains restrictive to participants and largely arbitrage-driven. Securitization, which once had the jump on other Asian markets, has failed to take off. To meet the needs of its firms and investors, the bond market must therefore evolve. This will mean creating new market sectors such as exchange-traded interest rate and foreign exchange derivatives contracts. It will mean relaxing exchange restrictions, easing investment mandates on contractual savings institutions, reforming the stamp duty tax, and revamping disclosure requirements for corporate public offers. This paper reviews the development and outlook of the Indian bond market. It looks at the market participants—including life insurance, pension funds, mutual funds and foreign investors—and it discusses the importance to development of learning from the innovations and experiences of others. "
Citation
Wells, Stephen; Schou-Zibell, Lotte. 2008. India’s Bond Market— Developments and Challenges Ahead. © Asian Development Bank. http://hdl.handle.net/11540/1971. License: CC BY 3.0 IGO.Keywords
Asian Development Bank
Development
Regional Economic Integration
Financial Sector Policies
Financial Risk Management
Bond Financing
Economic integration
Development Bank
Capital Market
Regional Plans
Regional Development Bank
Development finance
Development Banks
Local government bonds
Bonds
Catastrophe bonds
Bond funds
Bond market
Multilateral development banks
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