Govt securities to be included in JP Morgan Bond Index from June 28
Indian government bonds or government securities (G-secs) would be included in JP Morgan-Emerging Market Bond Index beginning Friday, a move that will bring down borrowing cost for the government.
The inclusion of IGBs will be staggered over a 10-month period from June 28, 2024 to March 31, 2025, indicating one per cent increment on its index weight.
India's weight is expected to reach the maximum threshold of 10 per cent in the GBI-EM Global Diversified, and approximately 8.7 per cent in the GBI-EM Global Index.
This would help attract higher foreign flows, as many overseas funds are mandated to track global indices.
It will also help bring in large passive investments from overseas, as a result of which more domestic capital would be available for industry, as crowding out would be reduced.
In her Budget speech for 2020-21, Finance Minister Nirmala Sitharaman had said, Certain specified categories of government securities would be opened fully for non-resident investors, apart f