Reports state India entering in the global indexes shall bring around Rs. 3000 crores to Rs. 4000 crores.
India is likely to enter the Bloomberg Global Aggregate Index and JP Morgan GBI-EM Index by the end of 2021.
Bonds could pull huge baskets of money through the FAR route introduced by the Reserve Bank of India.
FAR is a Fully Accessible Route introduced by the Reserve Bank of India to enable non-resident investors to get access to investment in specified government securities without any limitations.
Forecast by HSBC states foreign ownership to clinch from 3% to 10%-13%.
It is a good diversification of portfolio for investors investing in emerging markets having a combination of acute foreign ownership of bonds in India,
However, an opening up of government securities for foreign investors shows growing confidence in the stability of India monetory policies at the macro level in terms of stability, cost of capital, and investments.
This shows signs of huge positive structural long-term growth.